Economic, political vagueness puts stocks, rupee under massive pressure

ISLAMABAD: Recent economic and political uncertainty in the country has left negative impacts on stocks and currency, with the key index of the Pakistan Stock Exchange (PSX) losing over 700 points and the rupee depreciating by 1.97 percent, economic experts said.

Both stocks and rupee landed in the red zone against the backdrop of the by-polls held Sunday in Punjab, home to over half of Pakistan’s population, the experts said.

“In a surprising development, former prime minister Imran Khan-led Pakistan Tehreek-e-Insaf won by a considerable margin in by-elections, and Khan had been campaigning for holding early elections since his removal from the office through a vote of no confidence in April,” Maroof Ali Syed, a renowned economic expert and president of the Center for Economic Research in Pakistan, told Xinhua.

Khan’s success reinforced calls for early elections in the country, which stirred political and economic ambiguity at a time when Pakistan is in talks with the International Monetary Fund for a bailout package amid a financial crisis and depleting forex reserves, putting the rupee and stocks under immense pressure, he said.

The rupee hit a new low on Monday as the dollar continued its relentless upward march, with the greenback gaining more than four rupees in inter-bank trade.

Similarly, the PSX’s benchmark KSE 100-Index dipped by 1.68 percent or 707.80 to close at 41,367.11 on Monday.

The trading board presented a red look on Monday as the KSE All-Share Index fell by 1.40 percent or 404.78 to close at 28,491.62, the KSE 30-Index slid by 1.90 percent or 304.49 to end at 15,746.13, the KMI 30-Index lost 1.82 percent or 1,270.57 to conclude at 68,404.35, whereas the Islamic All-Share Index deflated by 1.42 percent or 300.23 to finish at 20,868.61.

Among 337 active scrips on Monday, the prices of 60 issues closed in the green ink, 260 ended down in the bearish lap, whereas the values of 17 other listed companies remained unchanged.

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