Pakistan-Afghanistan War: Pakistan Stock Market Crashes, Karachi 100 Index Drops 3,475 Pts; Know Everything

The Pakistan Stock Exchange came to a standstill on February 27, 2026, as the country's tensions escalate near its borders. It's not India this time; let's be clear. Instead, Pakistan has declared a war against another neighbor, Afghanistan. Information Minister Attaullah Tarar has claimed that 133 Afghan Taliban operatives were killed and more than 200 were injured in a series of airstrikes. The development met an extreme selling pressure on the market front.

Karachi 100 Index:

The KSE 100 index faced intense selloffs in the early hours of February 27, pushing the exchange to crash by a breathtaking 3,474.5 points or 2.05% to hit an intraday low of 165,811.90. This results in nearly 3% decline year-to-date for the exchange.

The exchange felt a bearish tone across its sectoral indices such as oil and gas exploration, oil marketing companies (OMCs), power generation, refineries, banks, financial services, fertilisers and others. Among the stocks that took heavy hit were ARL, MARI, OGDC, POL, PPL, SSGC, SNGPL, MCB, MEBL and NBP.

Pakistan Stock Exchange Website Down:

Amidst the chaos, the main website of the Pakistan Stock Exchange went under maintenance. However, this exchange website has been down for a year now.

Pakistan - Afghanistan War:

The tensions between Pakistan and Afghanistan have lingered for many years, but escalated rapidly since last year. Now, the Pakistan's Defence Minister Khawaja Asif has stated that there is an open war between Pakistan and Afghanistan's Taliban government. This latest attack on Afghan soil is called as 'Operation Ghazib Lil-haq' by Pakistan.

That being said, Pakistan launched a series of airstrikes on military bases in cities such as Kabul, Paktia, and Kandahar. Pakistan's Information Minister Attaullah Tarar claimed that the country's military strikes have killed 133 Afghan Taliban fighters and more than 200 were reported injured.

However, Taliban government refuted the statement saying, Pakistan's strikes killed eight Taliban fighters and 11 were wounded. But Taliban authorities reportedly also said that they killed 55 Pakistani soldiers during their retaliation, captured two military bases and nine military posts.

However, Pakistan claims that Taliban killed only two of their personnel.

Right after Pakistan's open war declaration, Taliban government spokesperson Zabihullah ⁠Mujahid stated that Afghanistan has carried out "large-scale offensive operations" against the Pakistani military. This was done at the "Durand Line", which is a 2,640-kilometre (1,640 mi) international border between Afghanistan and Pakistan.

The latest attack is among the series of strikes carried by Pakistan. Earlier, on February 21st, the Pakistan Air Force (PAF) launched airstrikes over the provinces of Nangarhar, Paktika and Khost in Afghanistan with the stated aim of targeting seven alleged militant camps that is reported to belong to the Pakistani Taliban (TTP) and the Islamic State - Khorasan Province (ISIS-K) across the three provinces. This was in retaliation for recent terrorist attacks in Islamabad, Bajaur, and Bannu, which Pakistan believes was carried out by the Taliban of Afghanistan.

The conflict occurred against the backdrop of long-running tensions between Pakistan and the Taliban government of Afghanistan, centred on Pakistan's accusations that Afghan soil is used as a safe haven by the Tehreek-e-Taliban Pakistan (TTP) and other militants to launch attacks inside Pakistan. A fragile ceasefire was agreed in October 2025 after the deadliest cross-border clashes in years, mediated by Qatar, but subsequent talks failed to produce a lasting agreement and low-level incidents continued. The operation took place days after the Saudi Arabian mediated release of three Pakistani soldiers captured during the October 2025 clashes, as per Wikipedia.