PSX Extends Losses Amid Tariff and Geopolitical Concerns

KARACHI: (Web Desk) – The Pakistan Stock Exchange extended losses on Tuesday, though a late rebound limited the decline as value investors stepped in following Monday’s sharp sell-off. Investor sentiment remained under pressure from higher government bond yields, policy uncertainty, fresh US tariffs, and escalating geopolitical risks.

The PSX benchmark KSE-100 Index closed at 166,258.54 points, down 1,432.54 points, or 0.85%, from Monday’s close of 167,691.08. During the session, the index traded between a high of 169,237.51 and a low of 163,907.59.

“Stocks witnessed selling after a surge in government bond yields in last week’s SBP auction. Policy tightening amid rising inflation and weak earnings projections led to the massive sell-off,” said Ahsan Mehanti, MD and CEO of Arif Habib Commodities. He added that US trade tariff uncertainty, geopolitical crises, and uncertainty over the IMF third review also fueled bearish sentiment.

Fresh US tariffs on imports came into effect Tuesday after Donald Trump reshaped his trade agenda following a Supreme Court ruling that struck down many broad duties. The new tariffs start at 10% with plans to potentially raise them to 15%, while existing sector-specific tariffs on steel and autos remain.

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Trump also indicated he may decide within “10 or 15 days” whether to take military action against Iran if no nuclear deal is reached, while indirect US-Iran talks are ongoing in Oman and Switzerland.

“It seems like a relief bounce after a sharp sell-off. Selective buying is seen by value hunters. Broader direction will depend on US-Iran talks,” noted AAH Soomro, an independent analyst.

Domestically, Pakistan posted a current account surplus of $121 million in January, driven by strong remittances and lower imports, though the cumulative 7MFY26 deficit reached $1.07 billion. Weekly inflation, measured by the Sensitive Price Indicator (SPI), rose 1.16% for the week ending February 19, taking the SPI to 335.67, while year-on-year SPI inflation stood at 5.19%, according to the Pakistan Bureau of Statistics.