The equity market stayed under pressure on Tuesday as higher government bond yields and unclear policy signals made investors cautious, while new US tariff steps and rising global tensions added to the unease, though a late rebound trimmed losses as value hunters stepped in after the previous session’s sharp sell-off.
The Pakistan Stock Exchange’s (PSX) benchmark KSE-100 Index settled at 166,258.54 points, down 1,432.54 points, or 0.85%, from the previous close of 167,691.08.
The index reached an intraday high of 169,237.51 (up 1,546.43 points, or 0.92%) and a low of 163,907.59 (down 3,783.49 points, or -2.26%) against the previous close of 167,691.08.
"Stocks witnessed selling after a surge in Govt Bond yields in the SBP auction last week. SBP policy tightening amid surging inflation and weak earnings projections led to a massive selloff," said Ahsan Mehanti, Managing Director and CEO of Arif Habib Commodities.
"US trade tariff uncertainty, geopolitical crises and uncertainty over the outcome of IMF third review talks played a catalyst role in bearish activity at PSX," he added.
Fresh US tariffs on imported goods came into effect on Tuesday after President Donald Trump moved to rebuild his trade agenda following a Supreme Court ruling that struck down many of his broad duties.
The new tariffs, initially set at 10%, are framed as a response to US balance-of-payments deficits, with Trump signalling an increase to 15%, while sector-specific tariffs such as those on steel and autos remain intact.
The new duty is set to last 150 days unless extended by Congress, and US Customs and Border Protection said it would also stop collecting tariffs invalidated by the court starting Tuesday.
Trump has said he will decide in “10 or 15 days” whether to order strikes on Iran if no nuclear deal is reached, while Axios reported he was presented with military options including a direct attack on Iran’s supreme leader, Ayatollah Ali Khamenei.
The US and Iran have held two rounds of indirect talks in Oman and Switzerland, with talks set to resume Thursday in Switzerland, though positions have yet to converge.
Pakistan posted a current account surplus of $121 million in January on strong remittances and lower imports, but the cumulative position showed a $1.07 billion deficit in 7MFY26, compared with a $564 million surplus a year earlier, reflecting import normalisation as activity recovers and export growth remains moderate.
Separately, weekly inflation measured by the Sensitive Price Indicator (SPI) increased 1.16% in the week ended February 19, taking the SPI to 335.67 from 331.81; YoY SPI inflation stood at 5.19%, according to the Pakistan Bureau of Statistics (PBS).
On Monday, the KSE-100 plunged 5,478.63 points (3.16%) to close at 167,691.08, after moving between 174,336.86 and 166,886.63.
