The Pakistan Stock Exchange (PSX) remained volatile during the outgoing week, with the KSE-100 index closing at 153,866 points, down 3,630 points, or 2.3% week-on-week, as surging global oil prices and escalating US-Iran tensions rattled investor confidence.

On a day-on-day basis, the PSX commenced the week with a sharp sell-off on Monday as the benchmark KSE-100 index plunged 11,016 points (-6.99%) to close at 146,480, marking the second-largest point-wise decline in the history of the exchange.

However, the bourse staged a remarkable rebound on Tuesday, when the index surged 9,697 points (+6.62%) to close at 156,177, registering the second-highest point gain in history. The market experienced a mixed trading session on Wednesday and settled at 155,858, down 319 points (-0.20%).

On Thursday, the PSX witnessed another directionless and volatile trading session as the KSE-100 ended at 154,421, down 1,437 points (-0.92%). The stock market ended the week with lacklustre trading and settled at 153,866, down 555 points (-0.36%). Arif Habib Limited (AHL), in its weekly report, noted that the KSE-100 index remained volatile during the week, dropping sharply on Monday following a surge in global oil prices amid escalating US-Iran tensions. The market subsequently recovered some losses but still closed the week at 153,866 points, down 2.3% WoW (-3,630 points).

In its latest review, the State Bank kept the policy rate unchanged at 10.5% while adopting a cautious stance amid rising uncertainty stemming from the Middle East conflict and volatile global commodity prices. AHL mentioned that petroleum sales increased 13% year-on-year to 1.28 million tons in Feb’26, driven by higher motor spirit (MS) and high-speed diesel (HSD) demand, though sales declined 15% month-on-month amid demand slowdown in Ramazan and fewer days in February. Cumulative sales in 8MFY26 rose 4% to 10.96 million tons.

Refinery supplies increased 29% YoY in Feb’26, driven by stronger MS and HSD demand, while 8MFY26 volumes rose 12.5% to 7.1 million tons. Meanwhile, north-based cement manufacturers increased prices by Rs60 per 50kg bag to Rs1,480, primarily driven by higher fuel and energy costs, which increased production expenses. Remittances increased 5% YoY to $3.3 billion in Feb’26 (down 5% MoM), while 8MFY26 inflows rose 10% YoY to $26.5 billion. Auto sales fell 26% MoM to 17.1k units in Feb’26, mainly owing to Ramazan-related slowdown, normalisation after strong January sales and fewer days in the month. However, volumes surged 42% YoY and 8MFY26 cumulative sales swelled 43% to 128.5k units.

Pakistan’s trade deficit stood at $3 billion in Feb’26, with exports at $2.3 billion (-8.5% YoY, -25.5% MoM) and imports at $5.3 billion (-0.4% YoY, -8.4% MoM). The 8MFY26 deficit widened 25.3% to $25.1 billion, AHL added. JS Global Research Head Muhammad Waqas Ghani noted that the KSE-100 index continued to extend its decline as heightened geopolitical tensions weighed on the market. The index dropped 3,630 points (-2.3% WoW), following last week’s 10,566-point decline, pushing the cumulative fall from its January 2026 peak of 189,167 to nearly 19%.

Market activity remained volatile throughout the week as investors continued to reduce exposure amid regional tensions and domestic security concerns. Sentiment remained cautious ahead of key macro developments. The IMF, in its end-of-mission statement on the third Extended Fund Facility review and second Resilience and Sustainability Facility review, noted considerable progress in discussions, which would continue to assess the impact of recent global developments on Pakistan’s economy. As a net energy importer, Pakistan’s economy remains highly sensitive to international oil prices, with the government raising petrol prices by Rs55/litre last weekend, Ghani said.

As per latest data, the Sensitive Price Indicator rose 1.89% WoW, driven mainly by higher petroleum product prices. On the other hand, remittances fell MoM in Feb’26 but stayed above $3 billion, with the UAE being the major contributor. Moreover, the State Bank’s reserves reached $16.34 billion, he added.