Pakistan’s stock market is projected to reach 203,000 points by December under a base-case outlook, though analysts warn it could fall to around 187,000 if geopolitical tensions—particularly involving US-Iran escalation—disrupt global oil prices and investor sentiment.

The Pakistan Stock Exchange (PSX) outlook remains broadly positive in the baseline scenario, supported by expectations of macroeconomic stability, steady liquidity conditions, and policy continuity in the upcoming fiscal period.

However, the forecast includes a clear downside scenario. If global oil prices surge due to heightened geopolitical conflict, Pakistan’s external balance and inflation outlook could come under pressure. This would likely weaken market confidence and push the KSE-100 index toward the lower estimate of 187,000.

Analysts highlight that Pakistan’s equity market remains highly exposed to global energy price movements due to its reliance on imported fuel. Any sustained spike in crude oil prices could affect corporate earnings projections and overall valuations.

Despite these risks, the base-case target of 203,000 reflects expectations of earnings growth and a relatively stable domestic policy environment. The market’s near-term direction is therefore expected to be driven more by global risk factors than by local fiscal changes.