Business | Markets
Pakistani equities plunge 3.6%
Pakistan stocks fell nearly four per cent yesterday as investors sold blue chips amidst uncertainty whether the coalition government's parties can work together to tackle pressing economic issues.
- Reuters
- Published: 23:43 August 20, 2008
Karachi: Pakistan stocks fell nearly four per cent yesterday as investors sold blue chips amidst uncertainty whether the coalition government's parties can work together to tackle pressing economic issues.
The benchmark Karachi Stock Exchange index fell as much as 3.99 per cent in intra-day trade. It ended down 3.6 per cent, the sharpest one-day fall in two weeks. The market is down about 25 per cent this year.
"With a host of tricky situations to be tackled in the medium term, a coalition marred by infighting is not likely to inspire confidence for market participants, locally or internationally," Imtiaz Gadar, an analyst at JPMorgan, said in a note.
"Once the Musharraf [resignation] happened, everybody thought the coalition was going to work like a charm, but obviously that is not happening," said Asad Iqbal, managing director at Esmail Iqbal Securities.
Blue chips led losses yesterday. Oil and Gas Development, Pakistan's biggest firm by stock market value, fell five per cent.
The rupee also weakened yesterday. It ended trade at 74.80/90, compared to Tuesday's close of around 74.53/60. The currency has lost over a fifth of its value against the dollar this year.
In the money market, Pakistan's short-term money rates were flat yesterday as liquidity in the market stayed tight, traders said.
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