Recent Trends in Global Equity Markets Amid Geopolitical Tensions

The Pakistani equity market has recently shown a significant rebound, with the benchmark KSE-100 Index closing at 167,191.38 on April 10, 2026, up from 150,398.71 on April 3, 2026. This represents an increase of 16,792.67 points, or 11.17% week-on-week. The recovery is attributed to peace talks facilitated by Pakistan between the United States and Iran, which have eased regional geopolitical tensions and reduced risk premiums across emerging markets. Consequently, this has led to broad-based buying activity in the local equity market, with total market capitalization rising to Rs4.863 trillion from Rs4.376 trillion during the same period.

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Sector-wise, commercial banks were the largest contributors to the KSE-100 Index, adding 4,613.06 points, followed by the cement sector, which contributed 2,479.71 points. Other sectors, including oil and gas exploration, technology, and pharmaceuticals, also showed notable gains, indicating widespread participation across various industries. Despite the overall positive trend, foreign investment flows remained negative, with foreign investors net selling Rs1.22 billion ($4.40 million), while local mutual funds emerged as the largest buyers, contributing significantly to the market rally.

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In Nigeria, the equity market capitalization surged by N1.36 trillion, closing the week at N131.1 trillion, up from N129.8 trillion. The All-Share Index appreciated by 1.03%, reaching 203,770.43 points. The market experienced gains in four trading sessions, despite a public holiday on Monday for Easter. Notably, the Financial Services Industry led trading activity, contributing 68.54% of the total equity turnover volume. The week also saw 25 equities appreciating in price, while 54 depreciated, reflecting a mixed performance across the board.

NGX ROUNDUP: Market capitalisation surges by N1.36tr as equities boomWeekly Market RoundupWall Street Journal

The ongoing geopolitical tensions, particularly related to the Iran conflict, have influenced investor sentiment across various markets. Analysts suggest that a renewed focus on energy security could benefit sustainability-focused investment managers like Impax Asset Management, despite recent outflows. Impax's second-quarter update indicated that 63% of its assets under management outperformed benchmarks, although management anticipates further outflows due to an exit tender process related to the Impax Environmental Markets investment trust.

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Despite the positive trends in equity markets, there are concerns regarding the sustainability of these gains. Critics argue that geopolitical uncertainties could lead to volatility, impacting investor confidence in the long term. Additionally, the reliance on local mutual funds to absorb foreign outflows raises questions about the stability of the market if these funds were to withdraw their investments.

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• “While this leads to a significant cut to our estimates, fund performance is improving with 63% of [assets under management] outperforming benchmarks in Q2 and, should that continue, means the expected recovery in net flows is only delayed, not canceled,” — Berenberg Analysts

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• “A market can be highly visible but still operationally constrained.” — Market Analysts

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In summary, the recent trends in equity markets in Pakistan and Nigeria highlight the complex interplay between geopolitical events and investor sentiment, with varying impacts across sectors and regions.

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