Pakistan stocks surge on hopes of US-Iran deal, falling oil prices

The Pakistan Stock Exchange (PSX) experienced a strong start to the week, with its benchmark KSE-100 index surging by 2,800 points during intraday trade on Monday. The index climbed to 170,714 points from its previous close of 167,844.24.

This bullish trend is largely attributed to renewed hopes for a diplomatic breakthrough between the United States and Iran concerning the Strait of Hormuz. Concurrently, oil prices saw a decline, with North Sea Brent crude and West Texas Intermediate slipping close to five percent to $99.41 and $92.49 a barrel, respectively.

Markets across Asia mirrored this positive sentiment. Tokyo's stock exchange soared over 3 percent in early trade, while Hong Kong and Seoul were closed for holidays. Shanghai saw a modest increase, and markets in Taipei, Manila, Bangkok, Jakarta, Singapore, Sydney, and Wellington also climbed. Kuala Lumpur was the exception, down 0.1 percent.

Last week concluded on a positive note for the PSX, with the KSE-100 index surpassing 167,000 points. This rally was fueled by improving diplomatic signals regarding the Middle East conflict, which boosted investor confidence and encouraged value-hunting. Pakistan has reportedly played a role in facilitating backchannel diplomacy between the US and Iran, easing concerns over potential oil supply disruptions and supporting the equity market.