KARACHI: Karachi Stock Exchange on Monday fell by 1.4 percent following the country plunged into political crisis after MQM’s withdrawal from the coalition government.
The KSE’s benchmark 100-share index fell 1.44 percent, or 173 points, to end at 11,849.46, on turnover of 91.18 million shares.
“Following the political crisis there is nervousness in the market and foreign investors are closely watching what direction the economy and politics will take now,” director at Invest & Finance Securities Ltd, Khalid Iqbal Siddiqu said.
“Government is not only running out of allies but importantly running out of time to bring about corrective measures to stabilise the economy,” said Sayem Ali, economist at Standard Chartered Bank.
“IMF staff review is due for June 2010 and the government will need to demonstrate ability to keep deficit at 4.7 percent of GDP and this looks like an impossible task.”
Thought the foreign investors had bought shares worth a net $515 million in 2010 and were a major contributor for the 28 percent rise of the KSE-index last year, are likely to stay on the sidelines awaiting clarity on the political situation
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