KARACHI: Pakistan stock market went through volatile and bearish week as the recovery after the correction in first three days was foiled by the fear of downgradation of Pakistan’s capital market by global index provider MSCI.
The benchmark KSE-100 Index retreated 635.31 points to 47,603.36 points at the end of the week compared to 48,238.67 points previous week.
“The dwongradation is more of an image issue for the market,” Khurram Schezad, CEO Alpha Beta Core, an investment advisory institution said in phone interview from Karachi.
In market’s points of view, it is better to be smaller member of MSCI Emerging Markets against being relatively bigger stake holder of Frontier Markets.
The market started the ended week under pressure due to uncertainty prevailing at the macroeconomic front due to negotiations between country’s finance managers and the International Monetary Fund.
However, the market kept indication resistance against decline on intraday basis, traders and analysts said. But the news of expected downgradation by the end of the week added to the selling pressure that took away support provided to fresh buying on lower share prices and lead to complete surrender by bulls, they added.
MSCI has started consultation on market reclassification proposal for the MSCI Pakistan Index to be reclassified from Emerging Market (EM) to Frontier Market (FM).
Meanwhile, National Command and Operation Centre (NCOC) head Asad Umar has said that Pakistan may face the fourth wave of the deadly coronavirus in July in the absence of a “strong enforcement” of the precautionary measures.