Pakistan-Afghanistan war: Amid escalating buzz over the Pak-Afghan war, the Karachi 100 Index (KSE 100 Index) witnessed sharp selling during the early morning session on Friday. Karachi 100 index opened on Friday with a downside gap and touched an intraday low of 1,67,948, logging an intraday loss of around 0.55% within a few minutes of the Opening Bell. However, some value buying occurred at lower levels, and the KSE 100 Index pared some of its losses from Friday morning’s deals.
Why is the Pakistan stock market falling today?
Speaking on the reason for volatility in the Pakistan stock market, Avinash Gorakshkar, a SEBI-registered fundamental equity analyst, said, “This fall in the KSE 100 Index can be attributed to the escalation of buzz over the Pakistan-Afghanistan war. After the cross-border attacks by Afghanistan, reports suggest that Pakistan carried out air strikes in Kabul and two other Afghan provinces early Friday, which escalated the geopolitical tension in the region.”
Gorakshkar said that the Pakistan-Afghanistan war at the current juncture may also affect primary market sentiment. He said that investors in Pakistan’s stock market have been waiting for 16 IPOs over the past 7 months.
Threat to upcoming IPOs in the Pakistan market
According to Bloomberg, two of the country’s prominent investment banks — Arif Habib Ltd. and Ktrade Securities Ltd. — have a combined pipeline of up to 16 IPOs over the next seven months. That compares with 11 listings in the past three years.
“Current market valuations are attractive for raising equity,” said Shahid Ali Habib, chief executive officer at Arif Habib, which expects to bring as many as eight offerings through June. Stability in the Pakistani rupee and a favorable interest-rate environment provide strong tailwinds for capital markets, he said.
Pakistan-Afghanistan war buzz
According to the news agency Associated Press (AP), Pakistan carried out airstrikes in Kabul and two other Afghan provinces early Friday, Afghanistan’s government spokesperson said, hours after Afghanistan launched a cross-border attack on Pakistan in the latest escalation of violence between the neighboring countries that made a Qatar-mediated ceasefire appear increasingly shaky.
At least three explosions were heard in Kabul, but there was no immediate information on the exact location of the strikes in the Afghan capital, or of any potential casualties. Government spokesperson Zabihullah Mujahid said Pakistan also carried out airstrikes in Kandahar to the south and in the southeastern province of Paktia.
Two senior Pakistani security officials told The Associated Press that Pakistan’s military carried out airstrikes targeting what they described as Afghan military facilities in Kabul, Kandahar and Paktia provinces, allegedly destroying two brigade bases, but they didn’t mention any potential casualties. The officials spoke on the condition of anonymity as they were not authorized to speak to the media on the record.
Afghanistan said its military launched its attack across the border into Pakistan late Thursday in retaliation for deadly Pakistani airstrikes on Afghan border areas Sunday, and claimed to have captured more than a dozen Pakistani army posts.
Pak-Afghan war: Pakistan declares ‘Open War’
Pakistan’s defense minister said that his country ran out of “patience” and considers that there is now an “open war” with Afghanistan, after both countries launched strikes following an Afghan cross-border attack.
In a post on Instead, he alleged, the Taliban had turned Afghanistan “into a colony of India,” gathered militants from around the world and began “exporting terrorism.”
“Our patience has now run out. Now it is open war between us,” he said. There has been no reaction from Afghan government officials to Asif’s comments.
Pakistan has frequently accused neighboring India of backing the outlawed Baloch Liberation Army and the Pakistani Taliban, allegations New Delhi denies.
The latest escalation of violence between the neighboring countries makes a Qatar-mediated ceasefire appear increasingly shaky. The Pakistani defense minister didn’t mention the ceasefire.
Asif also accused the Taliban government of denying Afghans basic human rights, including rights for women that he said are guaranteed under Islam, without providing details or evidence.
He said Pakistan had tried to maintain stability both directly and through friendly countries.
“Today, when attempts were made to target Pakistan with aggression, by the grace of God, our armed forces are giving a decisive response,” he said.
(With inputs from the Associated Press)
