Karachi Stock Exchange's benchmark index recovers 2% after steep fall amid India-Pakistan tensions

The benchmark KSE-100 Index of the Pakistan Stock Exchange opened 1.9% higher on Friday, rebounding from a sharp selloff a day earlier. On Thursday, the index had plunged 7.6% to an intraday low of 101,598.91, triggering a one-hour trading halt due to excessive volatility.

As of 10:10 am IST on Friday, the KSE-100 was trading at 105,467.7, up 1,940.9 points, or 1.9%, as investors cautiously returned to the market after two days of intense selling sparked by Operation Sindoor.

Meanwhile, the sharp decline on Thursday followed reports that multiple drones were shot down in major Pakistani cities, including Karachi and Lahore. The exchange later confirmed the trading halt after the index fell 7.2%.


Last month, the Pakistani market witnessed a similar crash after U.S. President Donald Trump announced new trade tariffs. The KSE-100 plunged by over 8,700 points, also triggering a brief halt in trading.

Tensions have been rising between India and Pakistan since the Pahalgam attack in late April, which left 26 civilians dead on the Indian side. In response, India launched missile strikes targeting terror infrastructure in Pakistan and Pakistan-occupied Kashmir.

Pakistan’s retaliatory actions included unprovoked firing along the Line of Control and a drone and missile attack on Thursday evening, which prompted India to activate its air defence systems. Defence sources confirmed that Indian forces intercepted all eight missiles aimed at regions including Satwari, Samba, RS Pura, and Arnia.

Explosions were also reported across Jammu and Kashmir during these intercepts, while several districts, including parts of Rajasthan and Punjab, enforced blackouts amid air raid sirens.

Defence Minister Rajnath Singh confirmed the success of Operation Sindoor, stating during an all-party meeting that over 100 terrorists were neutralised, though he refrained from sharing operational details.

International Reactions

U.S. Vice President JD Vance, speaking on Fox News, ruled out any involvement of Washington in the escalating India-Pakistan conflict but emphasized a willingness to engage both parties in de-escalation efforts. He stated, “What we can do is try to encourage these folks to de-escalate a little bit, but we're not going to get involved in the middle of a war that's fundamentally none of our business."

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