Pakistan's benchmark stock index staged a decisive comeback on Thursday, erasing a significant portion of the week's losses as investor sentiment shifted abruptly. The KSE-100 index vaulted 2,837.78 points, or 1.62 percent, to close at 178,123.56—a recovery that analysts called a 'strong rebound' from Tuesday's bloodbath. Main Developments Broad-based buying returned to the market from the opening bell. By 10:02am the index had already crossed 177,000 points, and from 11am onward it maintained a gain of over 2,000 points against the previous close. Heavyweight stocks—Engro Holdings, United Bank Limited, Meezan Bank Limited, Hub Power Company, and Lucky Cement—collectively contributed roughly 967 points to the rally, according to Topline Securities Ltd. Improved investor sentiment and easing concerns over geopolitical tensions were the primary drivers, the brokerage house noted. Renewed interest in blue-chip stocks helped the index recover a substantial portion of the losses recorded earlier this week. Read also: Why Two Middle East Oil Routes Face Simultaneous Disruption Background Thursday's rebound followed a brutal session on Tuesday when the KSE-100 index lost 6,408.23 points amid panic-driven selling. That selloff was triggered by escalating conflict between the US and Iran, which heightened fears about energy supplies passing through the strategic Strait of Hormuz. The war had intensified with strikes in the Middle East, and reports emerged that Tehran asked Yemen's Houthis to stand ready to close the Red Sea oil route. Awais Ashraf, director of research at AKD Securities, linked the recovery directly to US President Donald Trump's recent remarks. Trump said on Wednesday that Tehran was eager to reach a deal with Washington. 'They want to settle so badly. They don't like what we're doing, and they do want to settle. We'll find out whether or not we settle with them, or we just finish it off,' the president stated. Ashraf interpreted this as a signal that the US wanted to bring Iran back to the negotiation table to end the conflict. Why It Matters Stability in oil prices over the past two days has added to investor confidence, Ashraf observed. However, by Thursday evening Brent crude futures had risen 93 cents (1.09 percent) to $85.88 a barrel, while US West Texas Intermediate futures gained 89 cents (1.12 percent) to $80.49 a barrel. The uptick in oil came as concerns over energy supplies increased after the Iran war escalated, underscoring the fragility of the geopolitical environment. The stock market's recovery suggests that investors are betting on de-escalation—but the same factors that triggered Tuesday's rout remain active. Any renewed fighting or disruption to oil routes through the Strait of Hormuz or the Red Sea could reverse the gains. What's Next Market participants will watch for further diplomatic signals between Washington and Tehran. Trump's comments suggest a potential negotiation track, but no formal talks have been announced. Oil price movements will also remain a key barometer: sustained stability could reinforce the recovery, while another spike in crude would likely reignite selling pressure. The KSE-100's ability to hold above 178,000 points in the coming sessions will test whether Thursday's rally marks a genuine turning point or a temporary bounce.