Trading at Pakistan Stock Exchange (PSX) was halted for the second time this week amid a global meltdown in the international financial markets, a private TV channel reported.
The benchmark KSE-100 index was at 36,348 when the trading was halted at 02:17pm on Thursday for 45 minutes.
On Monday, the PSX’s benchmark KSE-100 index had plunged 2,106 points after the starting bell on the first day of the trading week, forcing authorities to halt trading.
External shocks due to breakout of coronavirus infections are pushing Pakistani stocks into a bear market, with the Karachi Stock Exchange (KSE-100) losing 1,324 points during intraday trading on Thursday.
The plunge was just the latest in a series of shocks which started Monday.
The bearish trend in the market on Thursday set in after the World Health Organization (WHO) declared the coronavirus a global pandemic.
At around 2:15pm, the KSE-100 index was down 3.6 per cent (1,324 points) to 36,349. At this point, trading at the PSX was halted for 45 minutes as bourse rules dictate. According to new rules, if the KSE-30 index moves 4pc or more in any direction for a consecutive five minutes, trading is halted for 45 minutes. The KSE-30 was down 4.36pc or 708 points to 16,220 at 2:15pm. When trading began a few minutes past 3pm, stocks continued their slide, with an intra-day low of 1,778 points or 4.72pc.
Deputy Head of Research at AKD Securities, Ali Asghar Poonawala, expressed his views, saying a ‘trifecta of dampeners is feeding into the negative sentiment’. He attributed the bearishness to the panicked sell off in international markets owing to coronavirus related travel restrictions around the globe. He said the local markets are facing the plunge as first case of the novel coronavirus was reported in a corporate firm and there was ‘spillover on the management’ and it was reflected in the stock market. Moreover, he was of the view that instability of rupee value is also pushing the fall.
“Travel restrictions don’t impact markets as such, global trade disruptions impact markets,” Head of Foreign Institutional Sales at Next Capital Limited, Muhammad Faizan, said. He said the market sentiment was due to the ongoing global sell-off triggered largely by the dip in oil prices. “[The] overall negative sentiments across the globe [are] also prevailing in Pakistan,” he said.
Asian equity markets, already deep in the red in reaction to the WHO announcement officially labelling the outbreak a pandemic, cratered after US President Donald Trump banned all travel from Europe to the US for a month.
Tokyo dropped more than 5 per cent, while Hong Kong finished the morning down 3.8pc and Sydney collapsed almost 7 per cent, with Bangkok around 8pc down. Seoul, Wellington, Mumbai and Taipei were off more than 4 per cent, with Singapore and Jakarta shedding more than 3 per cent. Shanghai eased 1.3 per cent.
