Karachi: Market conditions remained under pressure this week as the conflict between the United States and Iran expanded, jeopardizing a second critical energy chokepoint. Yemen's Houthi rebels declared a naval blockade on Saudi Arabia, claiming strikes on two Saudi oil tankers in the Red Sea, which threatened the flow at Bab el-Mandeb in addition to the ongoing disruption at the Strait of Hormuz. The US continued its military operations, marking the twelfth consecutive night of strikes on Iranian military targets. As a result, Brent crude oil prices briefly rose above $101 per barrel before settling at $97 per barrel, raising concerns over energy imports and inflation.

According to AKD Securities Limited, the benchmark stock index fell by 4,782 points, or 2.7% week-over-week, closing at 171,021 points. The average daily trading volume decreased by 3.2% week-over-week to 881.4 million shares. Some optimism was drawn from S&P Global's decision to upgrade Pakistan's long-term sovereign credit rating to 'B' with a stable outlook, based on stability and reform implementation. On the macroeconomic front, yields in the T-bill auction rose by 12 to 51 basis points across all tenors. In the banking sector, deposits saw a year-over-year increase of 15.2% to PKR 40.9 trillion as of June 2026. Urea offtakes rose by 2% year-over-year to 592,000 tons, driven by improved farm economics, subsidies, and lower financing costs, whereas sales of diammonium phosphate (DAP) fertilizers fell by 58% year-over-year due to higher pricing.