Market Watch: KSE-100 index recovers from over 1,600-point fall

By Muhammad YaseenPublished On 06 Jan 2023

KARACHI: The stock market remained in freefall as the index plummeted over 1,600 points in intra-day trading, following a crash in financial markets across the world amid deepening corona fears.

The drastic fall pushed the KSE-100 far below the 35,000-mark, triggering a halt in trading for the third time this week.

However, the index managed to make a decent recovery after trading resumed and was just over 500 points in red.

At 11:09am, the KSE-100 index – a benchmark for market performance – was down 510.79 points or 1.42% to stand at 35,445.90.

Panic selling continued to drive sentiments as global equities endured brutal sell-off with markets fron Seoul to Jakarta  punching through downlimit circuit breakers.

Losses were equally staggering outside Japan, driving MSCI’s broad Asia-Pacific index back to where it was in 2017. Gold and oil fell and once-safe sovereign bonds slumped as investors liquidated everything they could to cover losses.

Arif Habib Limited Head of Research Samiullah Tariq said the decline in regional markets created pressure in local markets.

“There is a sense of fear and panic,” said James Tao, an analyst at stockbroker Commsec in Sydney, where phones at the high-value client desk rang non-stop.

“It’s one of those situations where there is so much uncertainty that no-one quite knows how to respond…if it’s fight or flight, many people are choosing flight at the moment.”

Investors were also spooked by the US ban on travelling from Europe. Despite global efforts of a fiscal stimulus to cushion the blow, trillions continued to be wiped out of markets.