KSE-100 Index ends up in red zone despite recovery
Although the Pakistan Stock Exchange (PSX) recovered some ground after huge early losses, the KSE-100 Index still ended up in red zone as it closed the day with 286.22 points down.
The day started with more bloodbath as trading was once again suspended after the KSE-100 Index shed 1,752.01 points (5.76 percent) during early trading.
When the circuit breaker [45-minute break] was applied at 9:37am, the index stood at 28,664.04 after starting the day from the previous day’s level of 30,416.05.
However, the KSE-100 Index recovered some ground and stood at 30,129.83 by the time the business day ended, representing a 0.94 percent loss.
Even after the resumption, the index initially went down further to the level of 28,452.44, but then the recovery began.
The KSE-100 Index is down 26.45 percent since Jan 1, while the total loss suffered during last one year stands at 21.41 percent.
The mechanism was introduced by the Security and Exchange Commission of Pakistan (SECP) to counter the sudden losses and shore up investors in case of 4 percent losses during a session.
Applying the mechanism of trade suspension has become a new normal for the PSX since Monday last week. But the fact is it hasn’t worked in the long run so far.
That’s why earlier on Wednesday, trade suspension didn’t stop the downward trend as the stocks suffered more losses even after resumption.
The KSE-100 Index was down by 2,200.88 points (6.75 percent), as it closed at 30,416.05. At one point, the index was down to 30,378.68, the lowest level recorded during the trading.
Trading was suspended for 45 minutes at around 10:16am after the KSE-100 Index tumbled by 1,682.77 points (5.16 percent) during early trading.
The day began with the KSE-100 Index at 32,733.87 points but it reached the level of 30,934.16, which forced suspension. This mechanism is employed when the index is down by more than 4 per cent.
At one point, the KSE-100 Index had reached 32,632, but it closed at 32,733.87 when the trading closed for the day.