KARACHI: Trading was halted once again at the Pakistan Stock Exchange (PSX) on Wednesday after the stock market buckled under the financial strain of the ongoing coronavirus crises.
The benchmark KSE 100 index dropped by 1336.03 points in intra-day trading and closed at 27,228.80 points. The bourse tanked by 4.68 percent forcing trading to be halted just an hour after trading resumed today.
The Securities and Exchange Commission of Pakistan (SECP) has amended rules for the stock exchange in light of the situation brought on by the virus outbreak. The threshold for trading halt has also been changed from 5 percent to 3 percent drop at the KSE 30 index.
The lower KSE 30 index dropped by 693.08 points and closed at 11.822.83 points. This marks a decline of 5.53 percent in intra-day. The bourse had shed 5.33 percent of its value by noon when trading was brought to an abrupt halt.
The stock market has lost a third of its value since the beginning of this year as the economic and financial effects of the coronavirus keep mounting. The levels of around 27,300 points were last observed around six years ago.
There was optimism as Prime Minister Imran Khan announced a massive financial and economic stimulus package to offset the effects on coronavirus crisis. The package with an outlay of Rs1.2 trillion is aimed to provide much-needed relief to the working class, business community and industries.
The State Bank of Pakistan also revised the monetary policy in view of the coronavirus crisis and reduced the key interest rate by 150 bases points to 11 percent. This marks a decline of 225 basis points within a week as earlier the policy rate was reduced to 12.5 percent.
This failed to control the downward trajectory as the stock market had its second halt within the week. The coronavirus crisis is leading to a global recession and the economy will be the worst affected by the unprecedented pandemic whose impact is yet to be known.
ADVERTISEMENT
