At PSX volatility spiked daily trading 25.7%WoW

Pakistan Stock Exchange (PSX) remained volatile during the outgoing week driven by uncertainties surrounding the US-Iran conflict, pushing oil prices to US$80/ bbl before retreating. The benchmark index declined 4,626 points decline on Wednesday, but recovered partially on Friday. The index closed the week at 182,242 points, down 3,130 points or 1.7%WoW. Market activity remained strong, with average daily trading volume up 25.7%WoW to 1.3 billion shares.

On the macroeconomic front, worker remittances for June 2026 increased by 2%YoY to US$3.5 billion, taking FY26 total to a record high of US$41.6 billion, up 9%YoY.

Foreign exchange reserves held by State Bank of Pakistan (SBP) were reported at US$18.5 billion, as of July 03, 2026.

Yields during first FY27 T-Bills auction fell by 31-40 bps across all tenors.

Cement sales rose 18%YoY in June 2026 to 4.3 million tons, led by domestic dispatches, taking full year FY26 sales to 50.5 million tons, a 4-year high.

Other major news inflow during the week included: 1) Saudi makes biggest oil price cut in decades, 2) GoP buys more LNG as flows through Hormuz fail to recover, 3) IMF forecasts 3.5% growth rate for Pakistan’s economy in FY27, 4) RDA inflows increased to US$2.8 billion in FY26, and 5) Removal of MDR to provide leverage to banks.

Top performing sectors were: Synthetic & Rayon, Refinery, and Leasing Companies, while lagged included: Sugar & Allied Industries, Close-End Mutual Funds, and Transport.

Major buying was recorded by Individuals and Banks aggregated US$24.5 million. Major sellers were Companies and Mutual Funds with flows of US$20.9 million and US$11.3 million, respectively.

Top performing scrips were: IBFL, GHNI, CNERGY, PGLC, and LOTCHEM, while laggards included: MEHT, NPL, TPLRF1, KTML, and SNGP.

According to AKD Securities, going forward, positive progress on US-Iran conflict, along with moderating international oil prices towards pre-conflict levels would remain the key focus.

Additionally, favorable financial results for the period ended June 30, 2026 would support market sentiment in the near term. Market continues to trade at attractive valuations.

The brokerage house forecasts the benchmark Index to reach 263,800 by end December 2026.

Top picks of the brokerage house include: OGDC, PPL, UBL, MEBL, HBL, FFC, ENGROH, PSO, LUCK, FCCL, INDU, ILP and SYS.

Iran seeks to assassinate Donald Trump

Recent media reports alleging that Iran seeks to assassinate US President Donald Trump, alongside claims that Trump has instructed the United States to launch a devastating military response should such an attack occur, raise a far more important question than the headlines themselves. Are the rules governing the use of force universal, or are they reserved only for the powerful?

This is not a debate about personalities. It is a debate about principles.

For years, the United States and Israel have defended targeted killings of foreign military and political leaders as legitimate acts of self-defense or national security. Their argument is that extraordinary threats justify extraordinary measures. However, if this doctrine is accepted as a legitimate principle of international conduct, can other states not invoke the very same rationale when they perceive an existential threat?

The issue is not whether Iran is right or wrong. The issue is whether international law can survive if every country adopts the same standard. A principle that applies only to one nation is not a principle at all; it is simply an expression of power.

International politics has long demonstrated that labels are rarely neutral. One nation's freedom fighter is another nation's terrorist. Likewise, one country's "targeted strike" may be viewed by another as political assassination or an act of war. Perspectives differ, but the consequences remain the same.

Iran has endured US sanctions, diplomatic isolation and repeated military threats for nearly half a century. From Tehran's perspective, these policies represent continuous hostility. It is therefore understandable why successive Iranian leaders have described the United States as the "Great Satan." Whether one agrees with that description is beside the point. The reality is that prolonged confrontation has deepened mistrust on both sides.

History offers a consistent lesson. Political assassinations rarely resolve conflicts. More often, they fuel retaliation, strengthen hardliners, weaken diplomacy and perpetuate cycles of violence. Every action establishes a precedent, and every precedent eventually finds a new claimant.

The world should therefore resist the normalization of assassination as an instrument of statecraft. If the targeted killing of another country's political leadership becomes an accepted practice, no head of state can reasonably expect immunity from the same logic. Such a doctrine would make global politics less stable and far more dangerous.

The United States still has an opportunity to reverse this trajectory. Military threats, sanctions and coercion have failed to produce lasting stability in the Middle East. A renewed commitment to diplomacy, respect for sovereignty and the gradual easing of sanctions would serve regional and global security far better than another cycle of escalation.

The international order cannot be sustained through selective justice. The same rules must govern allies and adversaries alike. Otherwise, the world risks replacing the rule of law with the law of retaliation—a path from which there are no true victors.

China has 7 of world’s 10 biggest banks

China’s big four state-run banks are the largest in the world in terms of asset scale, a new report has found, underscoring Beijing’s rising ambitions to build the country into a global financial powerhouse.

The ranking released by The Banker magazine on Wednesday was topped by the four Chinese banks – Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China and Bank of China – with JPMorgan Chase following in fifth place.

In total, Chinese banks made up seven of the top 10 in the ranking, which lists global banks in terms of tier-one capital size. All seven of them are controlled by the Chinese government.

Postal Savings Bank of China broke into the top 10 for the first time, while US giants Bank of America and Citigroup ranked sixth and eighth, respectively.

Chinese banks collectively held US$54.8 trillion in total assets, more than double the US$25 trillion held by US banks in the ranking, data showed.

However, the race is not only about size, as US banks continue to hold the advantage in terms of profitability.

Chinese banks in the top 1,000 ranking reported combined pre-tax profits of US$392 billion, compared with US$328 billion for US banks.

The publication noted that American lenders maintained a clear lead in profitability performance, while European banks recorded stronger earnings growth after a relatively weak previous year.

The expansion of China’s banks is closely linked to Beijing’s broader financial ambitions: increasing the global role of the yuan, developing alternative cross-border financing channels and extending China’s influence through overseas banking operations.

Silvia Pavoni, editor-in-chief of The Banker, said Chinese banks’ international expansion and efforts to promote yuan internationalization would become increasingly important drivers of future growth and profitability.

“China’s largest banks continue to underpin their dominance,” Pavoni said, adding that the scale and resilience of the country’s banking sector remained significant as the global economy faced uncertainty and geopolitical challenges.

 

The Gulf Must Not Become the Next Casualty

President Donald Trump's latest remarks should be treated as more than political rhetoric. For the Gulf Cooperation Council (GCC), they should serve as a strategic warning. Every indication that the United States is prepared to sustain pressure on Iran rather than prioritize reconciliation raises an uncomfortable question: who stands to lose the most from another prolonged regional confrontation?

The answer is unlikely to be Washington or Tehran. It is the Gulf.

Over the past decade, GCC countries have invested hundreds of billions of dollars to diversify their economies, attract foreign investment and transform themselves into global hubs for trade, finance and tourism. Those ambitions depend on one indispensable ingredient—regional stability. Every new military crisis threatens to undermine years of economic progress.

Modern conflicts are no longer judged solely by territorial gains or military victories. They also reshape energy markets, sustain defence industries, influence financial markets and reinforce geopolitical leverage. Periods of prolonged uncertainty often coincide with higher military spending, increased demand for sophisticated weapons systems and heightened volatility in global commodity and equity markets. International media organizations also benefit from continuous coverage of unfolding crises. Yet the countries closest to the conflict invariably bear the greatest economic and security costs.

Energy remains at the heart of this equation. Any threat to Gulf shipping routes or oil infrastructure immediately disrupts global markets, increases freight and insurance costs and weakens investor confidence. While uncertainty pushes energy prices higher, it also encourages consuming nations to diversify supplies and seek alternative sources, creating long-term challenges for traditional exporters.

The GCC must also confront a strategic reality. Iran possesses limited capability to inflict decisive damage on the United States itself. However, American military installations across the Gulf represent visible strategic assets that could become focal points during any wider regional escalation. Whether justified or not, the presence of these facilities inevitably exposes host nations to risks that originate beyond their own borders.

This does not argue for abandoning long-standing security partnerships. Rather, it calls for a sober reassessment of whether existing arrangements continue to maximize Gulf security or inadvertently increase regional vulnerability. Every sovereign nation has both the right and the responsibility to periodically evaluate defence partnerships in light of changing geopolitical realities.

The Gulf has reached a pivotal moment. "Business as usual" is no longer a strategy. GCC leaders should collectively champion de-escalation, strengthen regional diplomacy and ensure that their territories do not become the principal arena for conflicts driven by external rivalries. Stability—not perpetual confrontation—is the foundation upon which the Gulf's future prosperity, security and global influence will ultimately rest.

Trump’s Iran Policy: Follow the Money, Not the Rhetoric

Donald Trump returned to the White House promising to end America's "endless wars" and restore stability through the "America First" agenda. Yet his handling of Iran has told a different story. Since the fragile US-Iran ceasefire was announced, violations have become almost routine. Washington's position has oscillated between calls for restraint and renewed threats. The latest example came when President Trump declared that the interim deal aimed at ending the conflict was "over," once again injecting uncertainty into already fragile global markets.

The reaction was immediate. Wall Street's major indices slipped as investors reassessed geopolitical risks. The ripple effects reached far beyond the United States. Pakistan Stock Exchange also came under heavy selling pressure before recovering part of its losses by the close. Financial markets have become hostages to political messaging emanating from Washington.

During the US presidential campaign, I wrote that it mattered little whether Donald Trump or Kamala Harris won the election. The occupant of the White House would change, but the powerful interests shaping American foreign policy would remain remarkably constant. Recent developments have only reinforced that conviction.

Washington's Iran policy appears to have become an exercise in managing competing domestic interests rather than pursuing a coherent diplomatic strategy. Every escalation benefits someone. Defence contractors receive larger orders as regional insecurity grows. Oil companies gain from heightened uncertainty in energy markets. Wall Street profits from volatility that creates trading opportunities. Major media organizations thrive on continuous crisis coverage that attracts audiences and advertising revenues.

None of these realities proves that any one of these powerful constituencies dictates White House decisions. But when every major policy shift repeatedly advances their commercial interests, skepticism is both natural and justified. In politics, patterns often reveal more than official statements.

The uncomfortable truth is that modern American foreign policy increasingly resembles a marketplace where geopolitical crises generate economic opportunities for influential stakeholders. Peace rarely produces exceptional corporate earnings. Tension does.

This is why Trump's changing posture towards Iran deserves closer scrutiny. The issue is not whether he personally seeks confrontation or compromise. The more important question is whether any American president can formulate Middle East policy free from the influence of the military-industrial establishment, energy giants, financial markets and the corporate media.

Perhaps the real lesson is this - American presidents come and go, campaign slogans change, and foreign policy narratives evolve. Yet the beneficiaries of prolonged instability appear strikingly familiar. Until that cycle is broken, the world will continue to pay the price for wars that are declared in the name of security but often end by serving the interests of power and profit.

Who Governs Yemen?

The emergency meeting of Yemen's Presidential Leadership Council in Riyadh over Iran's direct flight to Sanaa raises a fundamental question, who actually governs Yemen today?

The Council described the flight as a violation of Yemen's sovereignty and international law. Yet the very fact that the country's internationally recognized leadership convened outside Yemen inevitably invites scrutiny.

Governments derive legitimacy not only from international recognition but also from their ability to exercise effective authority over their own territory. In practical terms, the Houthis control Sanaa and much of northern Yemen, while the Presidential Leadership Council continues to rely heavily on external political and security support.

This reality reflects the uncomfortable truth that Yemen has evolved into a battleground where competing regional and global powers pursue strategic interests through local actors. Iran openly backs the Houthis, while the internationally recognized government enjoys diplomatic and military support from a coalition led by Saudi Arabia and backed by the United States.

The strategic significance of Yemen extends far beyond its internal politics. Sitting at the entrance to the Red Sea through the Bab el-Mandeb Strait, Yemen occupies one of the world's most critical maritime chokepoints. Whoever influences this corridor can affect international trade, energy supplies, and naval movements linking Europe and Asia.

It is therefore unsurprising that many analysts believe the broader contest in Yemen is less about restoring democratic governance and more about securing geopolitical influence over one of the world's busiest shipping routes. In this interpretation, Washington's overriding objective is to maintain strategic leverage over the Red Sea, while regional allies inevitably become participants in a much larger geopolitical competition.

Saudi Arabia is frequently portrayed as the principal architect of Yemen's prolonged conflict. Such a characterization, however, overlooks the wider strategic calculations of global powers. Riyadh has undoubtedly made decisions that attract criticism, but reducing the conflict to a Saudi-Iran rivalry ignores the interests of larger actors whose strategic priorities extend well beyond Yemen itself.

The tragedy is that while external powers compete for influence over a vital maritime corridor, the Yemeni people continue to pay the highest price. The real battle may not simply be for Yemen, but for control of one of the world's most strategically important waterways.

Trump and Netanyahu Have Made Iran a Regional Superpower

The greatest irony of the US-Israel military campaign against Iran is that it appears to have produced results opposite to those publicly declared by Washington and Tel Aviv. While Iran has undoubtedly suffered significant human, economic and infrastructure losses, the conflict has also demonstrated an uncomfortable reality - overwhelming military superiority does not always translate into strategic success.

The campaign, which began on February 28, 2026, was widely seen as an effort to weaken Iran's military capabilities, curtail its regional influence and force political concessions. Yet Iran has neither capitulated nor abandoned its strategic objectives. Instead, it has displayed remarkable resilience despite living under US sanctions for nearly half a century. History shows that nations subjected to prolonged external pressure often emerge more self-reliant, strategically patient and politically determined.

Perhaps the most significant consequence of the conflict has been the transformation of regional perceptions. Iran is increasingly viewed not merely as a country capable of surviving sustained military pressure, but as a state able to impose meaningful costs on two of the world's most powerful military forces. Whether one agrees with Tehran's policies or not, that perception alone strengthens its deterrence and elevates its regional standing.

The conflict has also prompted difficult questions about the United States' role in the Middle East. For decades, several regional governments relied on Washington as the ultimate guarantor of their security. Today, many are reassessing the costs and risks of that dependence. If confrontation with Iran places neighbouring states directly in harm's way, outsourcing national security no longer appears as reassuring as it once did.

Arab capitals also face an unavoidable geographical reality. Iran may lack the capability to strike the US mainland directly, but it possesses the means to target American military installations and strategic assets across the Gulf. Even without launching such attacks, the possibility alone has heightened concerns among governments hosting US forces and critical energy infrastructure.

Adding another layer of complexity are reports that Israel has offered to accommodate additional US military deployments on its territory. Whether viewed as strategic cooperation or military consolidation, such developments reinforce the perception that the regional security architecture is becoming increasingly polarized. Some Arab policymakers may also fear that refusing to align with initiatives such as the Abraham Accords could expose them to greater political and military pressure.

The broader geopolitical implications may prove even more consequential. If the United States gradually reduces its military footprint in the Arabian Peninsula, the resulting strategic vacuum is unlikely to remain unfilled. China and Russia have steadily expanded their diplomatic, economic and security engagement across the region and would be well positioned to deepen their influence as regional states diversify their strategic partnerships.

Ironically, a campaign intended to isolate and weaken Iran may instead be remembered for strengthening its regional position. Military conflicts often reshape perceptions more profoundly than they alter borders. In that respect, history may ultimately record that Trump and Netanyahu achieved the opposite of their declared objectives by helping transform Iran into a more influential and formidable regional power.