Pakistan Stock Market Plunges Over 2% As India Slaps Diplomatic Measures After Pahalgam Attack
The Pakistan Stock Exchange (PSX) opened sharply lower on Thursday, as investors reacted to India’s announcement of strong diplomatic actions against Pakistan
The Pakistan Stock Exchange (PSX) opened sharply lower on Thursday, as investors reacted to India’s announcement of strong diplomatic actions against Pakistan following the terrorist attack in Pahalgam that claimed 26 lives. The benchmark KSE-100 index dropped 2.12 per cent, or 2,485.85 points, to 114,740.29 within the first five minutes of trading, reflecting heightened geopolitical tensions in the region.
India’s Ministry of External Affairs announced a series of tough measures in response to the attack, including the suspension of the Indus Waters Treaty, immediate closure of trade via the Wagah-Attari border, and the revocation of visa exemptions for Pakistani nationals under the SAARC framework.
related stories
- Pakistan Government's Official X Account Withheld In India After Pahalgam Terror Attack
- Attari Border Closed After Pahalgam Terror Attack: How This Will Impact India-Pakistan Trade
- Big Protests Erupt Outside Pakistan High Commission In Delhi; 'Murdabad' Slogans Echo In The Air
- ‘Sad And Appalled’: Israel, World Leaders Condemn Pahalgam Terror Attack
Thursday’s sharp decline follows another significant drop on Wednesday, when the PSX closed lower after the International Monetary Fund (IMF) cut Pakistan’s GDP growth forecast to 2.6% for the current fiscal year.
Investor confidence has also been shaken by broader economic and political challenges. Fitch Ratings recently flagged concerns over Pakistan’s weakening currency, ongoing political uncertainty, and growing security risks, particularly in Kashmir, which have further undermined sentiment in the financial markets.
Pahalgam Attack Impact On Indian Stock Market
Back home, Indian markets remained largely unaffected in early trade on Thursday, though investors are closely monitoring the situation.
As of 12:39 am IST, the BSE Sensex was down 233 points, or 0.29%, at 79,884, while the Nifty50 declined 69 points, or 0.28%, to 24,259.
Vinit Bolinjkar, Head of Research at Ventura Securities, said that while a potential military response from India could lead to brief market disruptions, a broader trend reversal is unlikely unless the conflict escalates dramatically.
“Unless India undertakes strong military action against Pakistan, any market reaction may be limited. We’ve already seen equity markets absorb shocks from major global events like the Russia-Ukraine war and the US-China tariff standoff during President Trump’s tenure," Bolinjkar noted.
- Location :
- First Published: