India, Pakistan stocks bleed after Kashmir strikes

Business Desk
India, Pakistan stocks

Pakistani stockbrokers watch the latest share prices during a trading session at the Pakistan Stock Exchange in Karachi on Thursday. — AFP photo

Share markets in India and Pakistan slumped on Thursday after India said it had conducted ‘surgical strikes’ on suspected militants preparing to infiltrate from Pakistan-ruled Kashmir, escalating tensions between the nuclear-armed neighbours, reports Reuters.
Indian media reports said that the Bombay Stock Exchange suffered more compared to the Karachi Stock Exchange because of the panic-selling.
The benchmark KSE 100 index of Karachi bourse fell marginally by 59.5 points or 0.15 per cent to close at 40,295.52. The near flat close, however, does not give the whole picture of a volatile day of wild swings, reports Business Standard.
In contrast, BSE benchmark Sensex of Bombay bourse ended with a 465 point (1.64 per cent) loss, recovering from a deeper cut of over 500 points earlier.
The Bombay Stock Exchange slid 534.70 points, or 1.84 per cent, to 27,770.32 in afternoon trade after India said it had carried out the strikes to thwart attacks on some of its biggest cities, reports AFP.
India’s National Stock Exchange slid 1.75 per cent, or 152 points, to 8,592.25.
Across the border, the benchmark Pakistan Stock Exchange fell 0.37 per cent, or 147 points, to 40,207 following the border strikes, reversing early gains of some 500 points on OPEC’s decision to cut oil output.
‘Panic gripped investors over the uncertain conditions on the Indian border and they pulled out from the market,’ said Azam Khan, chief executive officer of Sunrise Capital Private Limited in Pakistan.

‘Markets will closely watch the next few days for further developments. Any such conflict creates uncertainty in the investment climate,’ said Shubhada Rao, chief economist at YES Bank in Mumbai, according to said Reuters report. ‘But it is premature to talk about serious war.’
Ranbir Singh, India’s director-general of military operations, said the strikes had been carried out along the unofficial border that divides the disputed territory on Wednesday night, provoking a furious reaction from Pakistan, reports AFP.
Pakistan’s military said two of its soldiers had been killed in what it called ‘cross-border fire’ while prime minister Nawaz Sharif condemned what he called India’s ‘naked aggression’.
The strikes come after the Indian government accused Pakistan-based militants of launching a deadly assault on an army base in Kashmir earlier this month that killed 18 soldiers.
India has been on a diplomatic drive to isolate its archrival and fellow nuclear power since the raid on September 18, the worst such attack in more than a decade.
Kashmir has been divided between India and Pakistan since gaining independence from Britain seven decades ago. The countries have fought two of their three wars over the territory.
Analysts in both countries, however, expect tensions would eventually ease given the stakes involved even if India has departed from its characteristic stance of strategic restraint, adds Reuters.
‘The consensus is that it’s not going to lead anything crazy like a war, but it’s bad for sentiment,’ said Gohar Rasool, head of sales for Karachi-based Intermarket Securities.

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