The Pakistan Stock Exchange (PSX) witnessed a powerful rally on Tuesday after US President Donald Trump announced a ceasefire between Iran and Israel. Investors responded with strong optimism, pushing the KSE-100 index up by 5,878 points during intraday trading. The benchmark surged to 122,045.62 points, marking a 5.06% gain.
Due to the sharp rise, trading was temporarily halted for one hour, as required by market rules. However, the momentum continued after the session resumed. The index added another 516 points, bringing the final total to 122,562.20 points by the end of the day. This remarkable rise reflected investor relief over reduced geopolitical tensions.
Just a day earlier, the PSX had suffered heavy losses, with the KSE-100 dropping by 3,855 points amid fears of war escalation. Market activity had been bearish due to concerns about regional instability. But the ceasefire announcement completely reversed market sentiment and restored confidence among investors.
President Trump revealed that both Israel and Iran had agreed to a “complete and total ceasefire” to end their 12-day conflict. According to him, the truce would be implemented in a staged manner, starting around 4 a.m. GMT on Tuesday. Trump’s announcement was seen as a key factor in calming financial markets worldwide.
Meanwhile, conflicting reports emerged from Iran, where an official claimed Tehran had not received any formal ceasefire offer from the US and would continue its response against aggression. This statement created some confusion, though overall global markets reacted positively to the potential de-escalation.
Oil prices also dropped sharply following the ceasefire news. Brent crude fell by 2.9% to $69.40 a barrel, while US crude declined by 3% to $66.48. The decline reflected reduced fears of supply disruptions in the oil-rich Middle East, further contributing to the bullish sentiment in stock markets like the PSX.