PSX market decline as oil surge shakes investor confidence

The PSX market decline continued on Monday as investors reacted to rising oil prices. In addition, higher bond yields increased fears of inflation and economic stress. As a result, market sentiment remained weak. The benchmark KSE-100 Index showed sharp swings during the session. It hit a high of 151,813 points but later dropped to 147,828 points. Therefore, investors stayed cautious throughout the day.

Oil Prices and Conflict Drive Uncertainty

Oil prices surged as tensions in the Middle East entered the fifth week. For example, attacks in the region raised fears of supply disruptions. Consequently, global markets reacted negatively. Brent crude climbed close to $117 per barrel at one point. Meanwhile, supply routes shifted due to safety concerns. This situation added pressure on economies that rely on imports.

Rising Yields and Foreign Outflows

At the same time, rising bond yields also worried investors. Higher returns on government bonds often pull money away from equities. Therefore, selling pressure increased in the stock market. Foreign investors continued to withdraw funds from Pakistan. Data showed significant outflows from treasury bills, bonds, and equities. As a result, overall investment confidence weakened further.

Inflation Adds to Market Concerns

Inflation also played a key role in the PSX market decline. Weekly inflation rose by 0.97 percent, according to official data. In addition, year on year inflation increased by over 8 percent. Higher inflation reduces purchasing power and raises costs for businesses. Consequently, investors remain cautious about future growth. On Friday, the index had already dropped by over 1,200 points. This ongoing trend reflects growing uncertainty in both local and global markets.