The Pakistan Stock Exchange’s (PSX) benchmark index continued in the red for a second day on Tuesday, losing more than 3,000 points during early trade.

The KSE-100 index had lost 3,464.89 points, dropping to 176,462.15 points from the previous close of 179,927.04.

The decline came as global oil prices rose nearly three per cent on Tuesday to their highest in four weeks, as the US reimposed its naval blockade of Iran while the two countries stepped up attacks in the Strait of Hormuz, heightening uncertainty about energy flows.

Brent crude futures were last up $1.50, or 1.8pc, to $84.80 per barrel at 0330 GMT, while US West Texas Intermediate crude rose $1.70, or 2.2pc, to $79.84 a barrel. Oil prices are now at their highest since the two countries signed a memorandum of understanding to end the war on June 17.

Awais Ashraf, director of research at AKD Securities, said the market declined after the US reinstated its naval blockade of Iran.

“The decline is broad-based, with cyclical sectors witnessing the sharpest percentage losses amid heightened uncertainty over the medium-term outlook due to the emerging geopolitical situation,” he said.

The stock market had come under pressure on Monday as equity investors grew nervous over developments in the Strait of Hormuz, dragging the benchmark KSE-100 index below the psychological barrier of 180,000 points.

The benchmark KSE-100 index remained under pressure throughout the session, touching an intraday low of 2,793 points before closing at 179,927, down 2,314 points or 1.27 per cent.

The decline was further exacerbated by broad-based profit-taking after the market’s recent rally, as investors chose to lock in gains despite an otherwise supportive macroeconomic backdrop.

Additional input from AFP