Pakistan's stock market extended its recovery Thursday as the KSE-100 index jumped 2,600 points in early trading, driven by investor optimism over potential de-escalation between the United States and Iran. Main Developments The benchmark index gained 2,604.49 points, or 1.49 percent, by 11:04am to reach 177,890.27, recovering from the previous close of 175,285.78. This follows Wednesday's partial rebound after Tuesday's sharp sell-off. Awais Ashraf, director of research at AKD Securities, attributed the rally to US President Donald Trump's remarks about Iran's willingness to negotiate. Trump stated Wednesday that Tehran was eager to reach a deal, saying, "They want to settle so badly." According to Ashraf, the comments signal Washington's intent to bring Iran back to the negotiating table to end the conflict. Read also: Why Pakistan's Textile Sector Is Stuck at $17.9 Billion Background The sustained positive momentum follows Tuesday's bloodbath when the KSE-100 lost 6,408.23 points amid panic-driven selling. That rout was triggered by renewed fighting between the US and Iran, which heightened concerns about energy flows through the strategic Strait of Hormuz. Equity investors engaged in value-hunting on Wednesday, partially recovering from Tuesday's losses. The geopolitical tensions had sparked fears of supply disruptions in global oil markets, impacting investor sentiment across regional bourses. Why It Matters Stability in oil prices over the past two days is adding to investor confidence, Ashraf observed. After initially rising for a fourth straight session, Brent crude futures slipped 24 cents to $84.95 a barrel, while US West Texas Intermediate futures fell 15 cents to $79.45. Lower oil prices ease import costs for Pakistan, a net energy importer, and reduce inflationary pressures. The stock market's recovery signals that diplomatic signals between Washington and Tehran are being closely watched by Pakistani investors. Any sustained de-escalation could further stabilize regional markets and attract foreign portfolio inflows. What's Next Market participants will monitor US-Iran negotiations and oil price trends in the coming sessions. The KSE-100's ability to hold above 177,000 points will be a key test of whether Tuesday's sell-off was an overreaction or the start of a deeper correction.