Pakistan shares slump 84 points after cricket attack

[LahoreEstate]

Brokers react to the news at the KSE on Tuesday

KARACHI: Pakistani shares slumped three per cent on Tuesday after a vicious attack on the Sri Lankan cricket team before state-run funds came to the rescue and reduced losses, dealers said.

The Karachi Stock Exchange’s benchmark KSE-100 index shed 84.80 points or 1.5 per cent to close at 5,596.49 on volume of 75.72 million shares.

Shares earlier dropped three per cent as brokers went into panic selling after the attack in the eastern city of Lahore sent shockwaves through the country. State-run funds came to rescue the market which reduced the losses by half.

‘The deteriorating law and order, and uncertain political situation is taking its toll and seeing foreign investors stay away from Pakistan,’ analyst Ahsan Mehnati told AFP.



‘The state-run funds protected the market today, but today’s terrorist attack will be affecting overall business a great deal.’ The market fell five per cent last Wednesday in the worst day’s performance in 32 months after the Supreme Court disqualified main opposition leader and former prime minister Nawaz Sharif from contesting elections.



‘The finance ministry is trying to revive our economy but it will remain in turmoil until the law and order situation is improved and political uncertainty is over,’ Mehnati said.



Pakistan’s market lost 58 per cent of its value during 2008 due to economic turmoil, political uncertainty and incessant militant attacks, particularly in the troubled northwest.

Shares have gained, albeit with occasional hiccups, in 2009 and investor confidence soared in January with the long-awaited launch of a state-owned 20-billion-rupee (250-million-dollar) investment fund to prop up the market.

Analysts said local investors would remain cautious in the coming days.

‘The situation might not improve during this week at least,’ Mehnati said.

http://www.dawn.com/wps/wcm/connect/Dawn...attack--il