KARACHI: The Pakistan Stock Exchange (PSX) came under pressure on Thursday as the benchmark KSE-100 index fell to levels seen before the start of the Middle East conflict, signalling weakening investor confidence.

Steep nervousness amid elevated oil prices remained the key factor threatening macroeconomic stability, as costly energy imports continued to weigh on the cost of doing business.

Topline Securities Ltd said the KSE-100 index endured a volatile, predominantly negative session, opening higher and briefly moving above the170,000 level. However, the early momentum failed to hold as profit-taking and broad-based selling intensified in the latter part of the session, resulting in a 1,332.47point decline, or 0.78 per cent, to close at 168,636.85.Pakistan Petroleum, United Bank, Hub Power, Oil and Gas Development Company, and Fauji Fertiliser remained the major drags, collectively wiping out around 470 points. Selling pressure was seen across banks,E&Ps, cements, and OMCs, reflecting a cautious trading environment.

Market sentiment weakened further as elevated crude oil prices and persistent geopolitical uncertainty promptedinvestors to adopt a more cautious stance.

Investor participation remained subdued as trading volume fell 7.24pc to 548.4 million shares and turnover value dipped 15.54pc to Rs17.05 billion.

According to Arif HabibLtd (AHL), market breadth was distinctly negative, with 14 shares rising and 86 falling.

Kohinoor Textile Mills (1.02pc), Service Industries (0.26pc) and Attock Refinery (0.21pc) contributed most to index gains.

The sell-off coincided with fresh inflation data.

Headline inflation in September rose to 10.3pc year-on-year, up sharply from 5.8pc in September 2025. As a result, average inflation for the first quarter of FY27 has jumped to 10.21pc, up from 4.30pc recorded in the same period last year.

On the energy front, the government is in discussions with its counterparts in Iran to secure safe passage for two October shipments of Qatari liquefied natural gas through the Strait of Hormuz.

AHL further noted that with sentiment turning cautious, the bias remains to the downside, with the 166,000 level clearly in sight.