The US-Iran ceasefire increases investor confidence, as the PSX rises 12,362 points.

The ceasefire agreement between the US and Iran sparked a purchasing rally on Wednesday, and the Pakistan Stock Exchange (PSX) opened on a positive note with notable gains.

The KSE-100 index increased 12,362.38 points when the market opened to reach 164,035.83 points, an 8.15 percent increase from the previous closing of 151,673.45 points.

As a two-week ceasefire in the Middle East ignited a relief rally driven by optimism that oil and gas shipments through the Strait of Hormuz could restart, oil prices plummeted, equities jumped and the dollar was knocked back.

After U.S. and Israeli raids on Iran at the end of February brought tensions to the brink, with Tehran effectively cutting off the crucial waterway that normally carries nearly 20% of the world’s oil and gas, the announcement culminated weeks of market instability and geopolitical turmoil.

Less than two hours before his deadline for Tehran to reopen the strait or risk catastrophic attacks on its civilian infrastructure, US President Donald Trump agreed to a ceasefire with Iran on Tuesday.

The market reacted quickly and dramatically, with Brent prices down 13% to $95.36 per barrel and U.S. oil futures falling about 15% to $96.31 per barrel.

European futures surged more than 5%, while S&P 500 futures increased more than 2%. The U.S. dollar, which had been the preferred refuge during the turmoil, saw a general decline.

Asia saw a temporary halt in trade as South Korea’s KOSPI (.KS11) increased 6% and Japan’s Nikkei (.N225) opened a new tab climbed almost 5%. This resulted in a 4% increase in the MSCI’s broadest index of Asia-Pacific stocks outside of Japan (.MIAPJ0000PUS).