The Pakistan Stock Exchange (PSX) endured another volatile session on Monday as escalating tensions in the Middle East kept investors on edge, although late-session buying helped the benchmark index erase early losses and finish marginally higher. The benchmark KSE-100 Index settled at 175,927.74, gaining 124.95 points, or 0.07%, after witnessing sharp intraday fluctuations driven by developments in the conflict between the United States and Iran.

The market opened under heavy selling pressure, with the benchmark sliding more than 2,000 points in early trade as investors reacted to reports of fresh military exchanges between Washington and Tehran. The index touched an intraday low of 173,636.46, down more than 2,166 points from the previous close, before gradually recouping losses through the remainder of the session.

It later climbed to an intraday high of 176,129.35, highlighting the day's extreme volatility.

Market participation remained healthy, with investors largely adopting a cautious stance amid heightened geopolitical uncertainty. Traders said initial risk aversion gave way to selective value buying later in the session, enabling the market to recover into positive territory.

Read: PSX extends losing streak on regional tensions

Ahmed Sheraz, equity trader at KTrade Securities said the KSE-100 started the week on a highly volatile note as investors remained cautious amid escalating geopolitical tensions in the Middle East. He noted that the benchmark reacted sharply to the latest developments between the US and Iran, including US strikes on Iranian infrastructure and Tehran's retaliatory response targeting American bases in the region.

"Despite the heightened uncertainty, the market staged a recovery from its intraday lows and closed in positive territory, reflecting resilience despite the volatile backdrop," Sheraz said. Looking ahead, he said market direction would remain closely linked to geopolitical developments in the Middle East. Any escalation or signs of de-escalation between the US and Iran could influence near-term sentiment, while the upcoming corporate earnings season is also expected to play a key role in shaping investor expectations.

Overall trading volume increased to 675.9 million shares against Friday’s close of 621 million while the value of traded shares stood at Rs30.2 billion. In ready market, shares of 492 companies were traded, of which 165 stocks closed higher, 277 decreased and 50 remained unchanged. 

Cnergyico PK was the volume leader with trading in 166 million shares, rising Rs0.8 to close at Rs10.61.