Priyanka Tiwari
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Suspense crime, Digital Desk : Trading was halted temporarily in Pakistan after the KSE-30 index plunged by 7.2%, marking a two-day downward streak. The dip occurred following India’s military assault known as Operation Sindoor, which struck several terrorist bases in both Pakistan and Pakistan-occupied Kashmir.
Investor sentiment takes a hit as KSE-100 Index drops
The index also suffered losses of more than 5%, at some point losing almost 6000 points before stablilizing around 104,087. Ever since the cowardly Pahalgam terrorist attack on April 22 that murdered 26 civilians, KSE-100 has suffered a loss of 13%, and KSE-30 has suffered a 14.3% hit.
Indian Markets Unmoved Despite Escalating Border Conflicts
Sensex and Nifty, India’s big caps, displayed strong resistance against the military operations and escalation in border activity which shows the dip in confidence investors and the economy.
Focus Shifting Towards IMF When It Comes To Bailout Extensions
Pakistani economy, on the other hand, is waiting for the value of its currency which seems to depend on the IMF Aid, scheduled for tomorrow regarding the extension of their financial package. The country’s market was previously bolstered by renewed confidence after receiving financial support from IMF but worsened the macroeconomic context, but has now been spoiled due to rising tensions.
Pakistan's Markets Once Soaring, Now Face Reversal
Pakistan’s equity market gave an 84% return in the preceding year on account of a credit rating upgrade and declining oil prices, making it one of the most sought assets globally. Even major asset managers like BlackRock and Eaton Vance had increased their market shares in this $50 billion market. However, geopolitical uncertainty seems to have changed the tide for Pakistan.
Pakistan's equities are said to go through seasonal weakness between May and September. In addition, data from Bloomberg shows the country went through its worst dollar bond performance in two years last month.
Military Nuclear Aggression Escalation
The Pakistani response to India’s aerial commanding range strikes on May 7 was reciprocated with artillery shelling of civilian targets in Jammu and Kashmir Kupwara district. Furthermore, Pakistani Defense Minister Khawaja Asif has made worrying remarks stating the nuclear war with India could happen anytime. Asif is expected to escalate already bloated tensions between both countries globally.
India Comes Under High Alert
The region seems to be on high alert waiting for a response from Indian society. Operation Sindoor, which entails the planned joint armed multi-theater action against the membranous covers of Jaish e Mohammad and Laskar e Taiba, is arguably one of the most advanced cross border attacks India has pulled off in recent time.
