KSE-100 Index: Trade halted for third time in a week

Karachi: Pakistan Stock Exchange’s (PSX) benchmark KSE-100 Share Index plunged in early hours of the last day of the business week.

KSE-100 Index has been closed for 45 minutes for the third time in a week due to severe recession. A few minutes after markets opened, trading was halted at the stock exchange for the third time this week.

The bullish trend continued since the start of trading on the last day of the week. When trading stopped, the KSE-100 index was down by 1682.96 points.

The 100 index was down at 4.68% during the trading session and KSE-100 index dropped to 34,273 points, after which the stock was stopped for 45 minutes.

Investors of the PSX witnessed bloodbath on Thursday, as the indices plunged, triggering a 45-minute ‘market halt’ at 2:13 pm.

What is Market Halt?

“Market halt” procedure has been introduced by Securities and Exchange Commission of Pakistan (SECP) in PSX regulations in December 2019. The action triggers when the KSE-30 index moves 4 % either way and remains there for 5 consecutive minutes.

The objective of introducing market halt is to safeguard investors and market participants during volatile markets. During this halt, trading in all securities remains temporarily suspended in order to ensure a cooling off period and run a mark to market activity as a risk management measure.

KSE-100: Single largest slump in history of over 2,000 points

On Monday, trading was halted for 45 minutes for the first time and it was called Black Monday. It was the third time this week that trade had to be halted.

The trouble has been hit by the global spread of coronavirus and oil markets were also affected by it. Saudi Arabia’s move to start a price war after Russia going to make further steep output cuts proposed by OPEC to stabilize oil markets.

Other factors include panic in global equities and suspension of imports from China and its adverse affects on Asian economy. Furthermore, sharper than expected downturn in international economies because of coronavirus continued to invade countries.