KSE-100 crashes below 40,000 barrier, shares down 1,138 points

Shares at the Pakistan Stock Exchange (PSX) plunged for the second consecutive day on Tuesday on the back of continued political and economic turmoil. The benchmark KSE-100 index closed at 39,832.45 points, down 1138.37 points or 2.78 per cent. The index reached an intraday low of 1,437.79 points, or 3.51pc, around 3pm. According to Arif Habib Limited, the index closed at a five-month low, a level last seen on July 21. Dalal Securities CEO Siddique Dalal said the index fell due to a number of reasons, including fear of the dissolution of Punjab and Khyber Pakhtunkhwa assemblies and rising political confrontations which had damaged investor confidence. Other factors that affected the market were mutual funds’ redemptions at year-end, worsening economic situation, pressure on the rupee, shortage of dollars and the delay in the completion of the International Monetary Fund’s (IMF) ninth review, he added. “All these factors brought the market down and there is no hope of improvement in the future,” Dalal said. “A lot of issues have accumulated, including dollar shortage, but the main reason remains political uncertainty and the impending dissolution of [two provincial] assemblies. There is pressure on foreign reserves as well,” First National Equities Limited Director Amir Shehzad commented.