By Muhammad Luqman
With business down by 20 percent , the political uncertainty has further squeezed the stock market in Pakistan that has already narrow base with only 35,000 investors or share holders.
Over the last four months after the disqualification of former Prime Minister Nawaz Sharif by country’s apex court on July 28 , the KSE-100 Index has shed around 9000 points, badly affecting the capitalization process.
In addition to the narrow investors base, the major victim of the declining trends is Chinese consortium who had recently bought 40 percent stake at a rate of Rs 28 per share.
The Chinese consortium has so far seen its investment shed close to 30% of the total value of $86 million.
The gloomy situation at the PSX is a far cry from what it was in 2016 when the KSE-100 posted the best return in Asia that was also among the top five in the world.
Now, it has become one of the cheapest emerging markets, but buyers are still missing in action.
“ Stock market has gone down by 20 percent due to uncertainty shrouding Pakistan’s politics,” says Haroon Askari, Managing Director Pakistan Stock Exchange.
To him, the uncertainty will continue to grip Pakistan’s Stock market till the next general elections , scheduled to be held in June next year after the completion of five-year of present government.
The pre-elections uncertainty , as the political analysts believe ,is not restricted to Pakistan alone . It happens in every democratic dispensation whenever the elections near. But in Pakistan’s case, the intensity is more due to the de-seating of former Prime Minister Nawaz Sharif whose exit has created uncertain scenario for the ruling party.
Pakistan Stock Index has lost around 10,000 points since the disqualification of former Prime Minister Nawaz Sharif and ensuing development in the politics of the South Asian nation.
