DAY AFTER IMF DEAL, PAKISTANI STOCKS FALL AS INVESTORS FRET

ISLAMABAD : The Pakistan Stock Exchange (PSX) experienced what analysts termed a bloodbath on Monday, a day after the government announced it will receive a $6 billion bailout package from International Monetary Fund.

The benchmark KSE-100 index shed 937 points — a loss of more than 2.7% — during intraday trading.

Trading opened at 34,716 points and showed an upward activity for a few minutes before adopting a negative trajectory for the rest of the session. As many as 89.9 million shares of the benchmark companies, worth Rs4.7 billion, changed hands during the session.

Local media quoted analysts as saying that the tough conditions attached with the IMF bailout package were responsible for the bearish trend at the bourse.

As a result of the conditions attached by the IMF, heavy taxation is set to be slapped on the consumers to improvise the target collection by a further 650700bn rupees, triggering further inflationary pressures and slowing down economic growth, commented one analyst.

“The investors have taken the IMF conditions as negative, especially with regard to free float of the rupee against the dollar and increasing the interest rate,” said Yawar Uz-zaman, head of Research at Shajar Capital, a brokerage house.

Pakistan and the IMF on Sunday reached the bailout agreement for the cash-strapped country, following months of painstaking negotiations. The deal still needs approval from the IMF board in Washington.

(With inputs from agencies)