The Pakistan Stock Exchange (PSX) began the week in the red, with the benchmark index plummeting 2,300 points on Monday amid ongoing hostilities in the Middle East.

The KSE-100 index touched an intraday low of 179,448.52 points soon after opening, down 2,793.25 points from the previous close of 182,241.77.

It then reversed some of its losses by 2:30pm, reaching an intraday high of 181,148.26 points.

However, the index witnessed further selling pressure as it declined to close at 179,927.04 points — down 2,314.73 points (1.27 per cent) from the previous close.

Mettis Global, a web-based financial portal, and Topline Securities Ltd said market sentiment remained under pressure after the US and Iran exchanged fresh strikes in an escalating contest over control of the Strait of Hormuz.

Oil prices also jumped more than three per cent on Monday due to the renewed fighting.

Topline Securities said the US-Iran exchanges “reignited concerns over a broader regional conflict, pushing international crude oil prices higher and triggering a risk-off sentiment across the market”.

“The decline was further exacerbated by broad-based profit-taking following the market’s recent rally, as investors opted to lock in gains despite an otherwise supportive macroeconomic backdrop,” the brokerage house noted.

“Trading activity remained subdued, with total traded volume easing to 845 million shares, while traded value stood at Rs35.5 billion. CNERGY topped the volume chart, with 158m shares changing hands,” it said.

Awais Ashraf, director of research at AKD Securities, said investor sentiment had dampened amid escalating attacks between the US and Iran.

Speaking to Dawn, he said the fighting had reduced traffic through the Strait of Hormuz to a five-week low and cast doubt on the future of the interim peace agreement signed last month.

Ashraf said that heavyweight stocks contributed the most to the early decline at the KSE-100 on Monday, despite falling only in the range of 1–1.7pc.

“Meanwhile, the refinery sector remained positive on expectations of the upcoming refinery policy, which is expected to pave the way for much-needed upgrades and expansions,” he said.

On Friday, value-hunting had helped the stock market reverse a three-session losing streak amid growing geopolitical concerns in the Middle East and the fallout on the global economy from an oil supply disruption fuelling inflationary pressure in countries reliant on supplies from the Strait of Hormuz.