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One of Pakistan’s major issues, alongside the escalating inflation, poverty, and unemployment, is the uncertain conditions affecting not only the employed population but also creating challenges for business individuals in the country.
In any country, when foreign investment comes in, an individual carefully considers investing money, assuming that the country’s conditions are stable and the invested capital will yield returns. However, this is not the case here.
Leaving aside foreign investment, the Pakistan Stock Exchange itself has become a puzzle. On December 1st, the KSE-100 index was at a level of 61,691 points, which had risen from 66,130 points on December 15, indicating a positive trend.
Boosted by investor confidence, more investments were initiated, but by December 18, the KSE-100 index had dropped to 65,000 points, and this gradual decline persisted. Just yesterday, the market witnessed a decrease of 2,400 points.
As of now, the KSE-100 index has fallen below 60,000 points to 59,293 points, suggesting that the market decline is not under the influence of any specific trend but rather an artificial crisis.
Whenever we analyze the stock market, we must consider international business conditions, such as the Russia-Ukraine conflict and the Gaza-Israel incident, as events that can impact the market.
Secondly, the emotions of investors play a crucial role. Investors may continue to invest in the stock market, but their intentions can be swayed by negative news, rumors, and suddenly spreading false information.
On the third point, we need to analyze the government’s introduced policies. Is there any impending issue that could discourage investors? For example, the announcement of general elections on February 8th is good news. However, the return of PML-N’s leader Nawaz Sharif could be a cause for concern among investors.
Government policies, new regulations, changes in monetary policies, and interest rates are also critical factors affecting investor sentiment. Additionally, if listed companies on the stock exchange are not performing well, it can impact investment.
However, some analysts believe that the rise and fall of the KSE-100 index are artificial. Behind it lies a large mafia that benefits from manipulating stock prices artificially, enticing new investors with higher prices and then turning them away, allowing them to buy shares at their preferred rates.
This apparent mafia spreads false news, artificially raises or lowers stock prices, and takes advantage of the situation. When the market will go up, when shares will fall to what extent, these are estimates made by a reasonable number of investors, and big players can manipulate the stock market as they please.
For small investors, investing in a business like the stock market in times of uncertain conditions in the country is not without serious risks. It is better to evaluate the stock market alongside the country’s uncertain conditions and implement reforms for the sake of empowerment.
