Riaz Haq writes this data-driven blog to provide information, express his opinions and make comments on many topics. Subjects include personal activities, education, South Asia, South Asian community, regional and international affairs and US politics to financial markets. Monday’s removal of an arbitrary floor of 9144 points on KSE-100 imposed Aug forex software day trading education currency dinar exchange has sent Karachi shares plunging 16.
However, some participating institutions balked at putting money into a falling market. Foreign portfolio investors who may have faced a liquidity crunch due to global events will offload their holdings in Pakistan,” said Farhan Mahmood, a research analyst at JS Global Securities. The trading volume at KSE has surged more than 50 times since Monday to over 50 million share a day. It had been less than a million shares a day on average since Aug 27, 2008. I took brief training in technical analysis last year, and started applying what I had learnt. It works on Forex because the market is so big, as for the KSE, it is small and highly manipulated. KSE’s drop is based on deterioration of economic fundamentals in Pakistan and the rest of the world.
Macroeconomic factors have caused plunges in markets worldwide. But the KSE, in addition, is highly manipulated. The time is near for long-term investors to pick good stocks at highly discounted rates, but for traders, this market is ‘high-risk-high-manipulation’. Who pulled the money out of KSE?
According to standard poor’s, Pakistan’s long-term outlook could be further improved. In May this year, Pakistan’s sovereign debt rating was lowered to B2 from B1, one level below Turkmenistan and Jamaica. The ranking on locally-issued debt was also reduced to B2. With further rating cuts, Pakistan ended up with junk ratings of CCC, far below the investment grade rating of B1 in 2007 under Musharraf-Aziz administration. Three Wall Street banks have abandoned their brokerage operations in Pakistan amid the nation’s bleak economic situation. Citigroup’s Citibank shuttered its equity research office in Karachi, the nation’s financial capital, in March.