India-Pakistan tensions: Karachi Stock Exchange index KSE 100 up 2% after crash

Operation Sindoor: The Karachi stock exchange has shown signs of recovery on Friday, rising 1.9% after experiencing a significant decline the previous day. The index had dropped 7.6% to 101,598.91 on Thursday, necessitating a one-hour trading suspension due to market instability.The KSE-100 reached 105,467.7 by 10:10 am IST on Friday, an increase of 1,940.9 points or 1.9%, as market participants cautiously resumed trading following two days of substantial selling triggered by India’s Operation Sindoor.Yesterday’s crash occurred after reports emerged about multiple drone attacks in major Pakistani urban centres, including Karachi and Lahore. The stock exchange authorities confirmed the trading suspension after the index recorded a 7.2% fall.In the previous month, the Pakistani market experienced a downturn following the announcement of new trade tariffs by the U.S. President Donald Trump. The KSE-100 decreased by more than 8,700 points, which also led to a temporary trading suspension, according to an ET report.Also Read | Operation Sindoor: Can Pakistan economically afford a protracted conflict with India as tensions escalate? Here's a reality checkThe relationship between India and Pakistan has deteriorated since the Pahalgam incident in late April, which resulted in 26 civilian casualties on the Indian side. Subsequently, India conducted missile strikes against terror-related facilities in Pakistan and Pakistan-occupied Kashmir.Pakistan retaliated with indiscriminate firing across the Line of Control and launched a combined drone and missile offensive. This prompted India to deploy its air defence mechanisms. At an all-party meeting, Defence Minister Rajnath Singh confirmed the successful execution of Operation Sindoor. He reported that more than 100 terrorists were eliminated but declined to provide specific operational information.