Tensions Escalate: Stock Markets Plunge Amid Indo-Pak Dispute

Pakistan’s stock market experienced a sharp decline due to increasing tensions with India following a deadly terror attack in Pahalgam, Jammu and Kashmir. The escalation included diplomatic fallouts and trade suspensions, leading to significant market volatility and concerns over prolonged bearish trends until political stabilization.

Pakistan's stock market tumbled sharply on Thursday, with the benchmark KSE-100 index closing at 115,019.81, dropping 2,206.33 points, as geopolitical tensions flared up between India and Pakistan in the aftermath of a deadly terrorist attack in Pahalgam, Jammu and Kashmir.

The attack, which saw 26 people killed, was claimed by The Resistance Front, a proxy of Lashkar-e-Taiba. In response, India downgraded ties with Pakistan and suspended critical measures, such as the Indus Water Treaty. Pakistan retaliated by scrapping bilateral trade agreements and airspace access.

This political strife has sent shockwaves through the stock market, with the index initially plunging 2,485 points before stabilizing slightly and closing down 1.92%. Analysts predict continued volatility until diplomatic relations improve.

(With inputs from agencies.)