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KSE100 Crashes 6% After Explosions in Pakistan; Trading Halted Amid India Tension

The Pakistan Stock Exchange witnessed a sharp fall of over 6% after explosions in Lahore and Karachi raised tension with India. Trading was halted briefly amid growing concerns of conflict following India's Operation Sindoor.
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Loud explosion were heard in Lahore, a day after India's Operation Sindoor. This raised tensions in Pakistan that India's response to Pahalgam terror attact is yet to be concluded.

Pakistan’s main stock index, KSE100, dropped sharply on Thursday following reports of explosions in Lahore and Karachi. The index fell by 6,948.73 points or 6.32%, reaching 103,060.30 before the Pakistan Stock Exchange halted trading for an hour.

This fall came a day after India launched 'Operation Sindoor', targeting terror camps in Pakistan and Pakistan-occupied Kashmir (PoK), causing fear of further escalation.

Also Read: Karachi Stock Market Crashes After India's Operation Sindoor

Pakistan Claims Indian Drones Shot Down

According to Pakistan’s military, they shot down 12 Indian drones, which reportedly entered Pakistani airspace. These drones, reportedly of Israeli origin (Harop drones), were allegedly targeting locations including Karachi and Lahore. Debris from the drones is being collected, according to Pakistani military spokesperson Ahmed Sharif Chaudhry.

Domestic Markets Remain Steady

While Pakistan’s stock market reacted strongly, Indian markets like Sensex and Nifty remained stable, showing little impact from the rising geopolitical tension.

Background: India’s Operation Sindoor

On May 7, India launched Operation Sindoor, striking at least nine terror locations across Pakistan and PoK, including Bahawalpur, Kotli, Muzaffarabad, Muridke, Gulpur, Bhimber, Bagh, Chak Amru, and Sialkot.

This marked India’s first missile strike of this scale since the 1971 war. The operation was a response to the Pahalgam terror attack, which killed 20 Indian tourists, making it the deadliest attack since the 2019 Pulwama bombing.

Expert Views on Market Impact

VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said that markets will remain sensitive to how Pakistan responds. However, he emphasized that a full-scale escalation could hurt investor sentiment across the region.

Emkay Global noted that the situation is unpredictable and could force changes in market strategies depending on how things develop.

Also Read: Operation Sindoor: Why Indian Stock Markets Didn't Panic

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