By Farhan Bokhari
Islamabad: The subdued atmosphere surrounding Pakistan's stock market outlook has failed to go away despite the International Monetary Fund (IMF) stepping into the equation.
The IMF's decision to bailout Pakistan's economy has lifted the country's liquid foreign currency reserves significantly.
Unlike the situation two months ago, Pakistan is nowhere near the brink of its first ever default on foreign debt payments - a fear that had provoked much flight of capital from the South Asian country.
Artificial floor
But still, for many looking at the stock market, there may not be immediate relief in sight.
The KSE-100 index of the Karachi stock exchange on Friday closed at approximately 5,793 points, after gaining a marginal 40.38 points on that day.
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The KSE-100 index has lost much ground since the government's regulator, the Securities and Exchange Commission of Pakistan or SECP, stepped into the fray last month, ordering the removal of an artificial floor slapped in August last year, which blocked the index from falling below a level of 9,118 points.
The downside of that was essentially that investment activity virtually dried up as new investors found little incentive to invest any longer.
But the removal of the floor has brought in a new reality.
While investment activity may be weak, there is no reason why bargain-hunting investors will not return once some other important issues are tackled.
While the economic picture may have improved relatively with IMF's help, there is still no shortage of rumours predicting political change during the year ahead.
For the Pakistani government, the important tasks that lie ahead are to stabilise and improve trends in the stock market.(Gulf News)
Islamabad: The subdued atmosphere surrounding Pakistan's stock market outlook has failed to go away despite the International Monetary Fund (IMF) stepping into the equation.
The IMF's decision to bailout Pakistan's economy has lifted the country's liquid foreign currency reserves significantly.
Unlike the situation two months ago, Pakistan is nowhere near the brink of its first ever default on foreign debt payments - a fear that had provoked much flight of capital from the South Asian country.
Artificial floor
But still, for many looking at the stock market, there may not be immediate relief in sight.
The KSE-100 index of the Karachi stock exchange on Friday closed at approximately 5,793 points, after gaining a marginal 40.38 points on that day.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
The KSE-100 index has lost much ground since the government's regulator, the Securities and Exchange Commission of Pakistan or SECP, stepped into the fray last month, ordering the removal of an artificial floor slapped in August last year, which blocked the index from falling below a level of 9,118 points.
The downside of that was essentially that investment activity virtually dried up as new investors found little incentive to invest any longer.
But the removal of the floor has brought in a new reality.
While investment activity may be weak, there is no reason why bargain-hunting investors will not return once some other important issues are tackled.
While the economic picture may have improved relatively with IMF's help, there is still no shortage of rumours predicting political change during the year ahead.
For the Pakistani government, the important tasks that lie ahead are to stabilise and improve trends in the stock market.(Gulf News)
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