Karachi – The Pakistan Stock Exchange (PSX) experienced its most severe single-day decline on record on Friday, February 27, 2026, as the benchmark KSE-100 Index tumbled 16,089 points, or 9.57%, to close at 151,973.
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The plunge was sparked by mounting geopolitical risks in the Middle East, particularly escalating tensions between the United States and Iran that fueled investor panic and widespread selling. Market participants cited fears of potential military confrontation, which had already begun to ripple through global markets and oil prices in the preceding days.
“The sharp downturn was triggered by escalating geopolitical tensions following the outbreak of war between the United States and Iran, which severely dented investor confidence and sparked widespread panic selling,” said Ali Najib, Deputy Head of Trading at Arif Habib Ltd.
Trading was halted within the first five minutes after the index crashed to an intraday low of 152,991 (down 15,071 points or 8.97%), breaching circuit breakers. Activity resumed around 10:22 am, leading to a sharp technical rebound of over 6,000 points to an intraday high of 159,329. However, renewed heavy selling in the closing hours wiped out the gains, resulting in the steep closing loss.
Heavyweight stocks bore the brunt, with major drags including FFC, UBL, ENGROH, HUBC, MEBL, OGDC, HBL, LUCK, MCB, and PPL collectively erasing 8,148 points from the index. Despite the turmoil, trading volume surged, exceeding 800 million shares, with turnover hitting PKR 48.3 billion. KEL topped the volume leaders with 163.3 million shares traded.
Analysts noted that while the session reflected extreme volatility driven by external shocks, robust participation suggested some bargain hunting during the rebound phase. Market direction ahead remains heavily tied to developments in the US-Iran standoff, with any further escalation likely to sustain pressure, while signs of de-escalation could support a recovery.