The Pakistan Stock Exchange suspended trading for two hours once again after the benchmark KSE-100 index lost 1,200 points within minutes of opening on Wednesday.
This was the 8th trading halt in March. The capital market closed last week with the benchmark index falling to its lowest level in five years.
The latest temporary halt at the PSX comes after Pakistan went into a lockdown to prevent the spread of COVID-19, which has already caused seven deaths in the country with total number of cases touching 1,000.
Given its devastating impact on the economy, the government has taken several steps including cutting the interest rate by 2.25%, petrol prices by Rs15 per and introducing a Rs150 billion aid package for the poor and labour classes.
However, all these measures were barely any help lifting market sentiment as investors continued to sell, dragging the index down to a level not seen in the last five years.
Equity markets across the world continue to bleed over fears of the economic implications of COVID-19, which the World Health Organization declared a global pandemic. Markets across the world have crashed with many witnessing temporary trade halts.
The Pakistani market was following the global trend, but the recent surge in local numbers of COVID-19 cases only aggravated panic selling. If the KSE-30, which tracks the performance of 30 large and most liquid stocks, moves 5% up or down from its opening value for five minutes, the rule is that trade must be halted for 45 minutes so investors can take fresh positions.
The Securities and Exchange Commission of Pakistan has raised this threshold to two hours for two weeks and reduced the stock market operation hours. The market now opens at 11am and closes at 3:30pm.
The KSE-100 was trading at the 27,262-point level when this news story went online.