The Pakistan Stock Exchange (PSX) extended gains on Wednesday, with the benchmark KSE-100 Index rising 1,174.46 points, or 0.69%, to 172,576.54 by 12:48pm as investors welcomed signs of progress towards a diplomatic solution to the US-Iran conflict.

The fresh diplomatic activity at the UN General Assembly in New York also supported market sentiment, after US and Iranian delegations held indirect talks through mediators on Tuesday.

The US President Donald Trump also said the discussions involving his envoys were productive and that there was momentum towards a deal, reviving hopes of an end to the conflict. 

The index opened on a positive note and had gained 787.31 points, or 0.46%, to reach 172,189.39 by 9:33am.

Buying was witnessed across major sectors, including automobile assemblers, cement, commercial banks, oil and gas exploration companies, oil marketing companies and refineries.

Read: Selective buying lifts PSX after mid-session fall

The index hit an intraday high of 172,762.41 and a low of 171,843.50.

Market sentiment was also supported by a decline in international oil prices as investors assessed improving Gulf supply after Saudi Arabia restarted operations at a critical pipeline.

Hopes for a diplomatic solution to the US-Iran conflict further weighed on oil prices, easing concerns over prolonged disruptions to regional energy supplies.

At midday, trading volume stood at 90.66 million shares, while the traded value was around Rs6.31 billion.