The Pakistan Stock Exchange (PSX) benchmark index rebounded from a two-day losing streak on Wednesday, surging over 1,000 points during early trading sessions.The KSE-100 index initially rose sharply before stabilizing, driven by improved investor sentiment following geopolitical developments.

Analysts attributed the recovery to Trump's policy changes, including replacing a proposed 20% toll on Hormuz traffic with GCC investment commitments and lower-than-expected US inflation easing fears of Fed rate hikes.Oil prices also climbed as tensions between the US and Iran escalated, with Brent and WTI futures gaining over 1%.However, the market faced extreme volatility earlier in the week, losing nearly 6,400 points due to panic from geopolitical risks.

The rebound highlights the interplay between global economic factors and local financial markets, with investors reassessing risk appetite amid shifting international dynamics.