Pahalgam terror attack: Pakistan stock market hit hard, KSE100 plunges 2,000 pts; here's why

KSE100, the benchmark index at Pakistan Stock Exchange (PSE), plunged over 2,000 points on Thursday, a day after India announced a series of diplomatic measures, targeting Pakistan in response to a deadly attack in Kashmir's Pahalgam that left 26 tourists dead. This was the most severe incident since the 2019 Pulwama bombing that killed 40 CRPF personnel.

At last count, KSE100 stood at 115,128.04, down 2,098.10 points or 1.79 per cent. Alliance Global Logistics (AGL), FrieslandCampina Engro Pakistan (FCEPL), Nishat Mills (NML), Pakistan International Bulk Terminal  (PIBTL),  Airlink Communication (AIRLINK) and Punjab Oil Mills (POML) were among some of the index stocks tumbling 5-7 per cent today.    

The 100-constituent index has jumped 64.28 per cent in the past one year, trading in a wide range of 70,562.12-120,796.67. 

India has attributed the attack to cross-border terrorism, holding Pakistan responsible for harboring militant groups operating in the region. It has suspended the Indus Water Treaty and downgraded its diplomatic relations with the neighbouring country. 

India has expelled Pakistan’s defence, naval, and air advisors from its mission in New Delhi, declaring them persona non grata. It is also in the process of withdrawing its own military advisors from Islamabad.

Besides, The SAARC Visa Exemption Scheme for Pakistani nationals has been suspended with immediate effect. The Integrated Check Post (ICP) at Attari, the only land border crossing currently in operation between the two countries, has also been ordered shut. 

Pakistani nationals in India on valid documentation are permitted to return before May 1.

Military analysts have noted unusual activity along the Jammu and Kashmir border, including the movement of Pakistani military assets. Defence observers, citing online flight tracking data, have indicated that Pakistan may be repositioning aircraft to forward bases, potentially in anticipation of a retaliatory strike from India. 

Pakistan on Thursday said: "Any attempt to stop or divert the flow of water belonging to Pakistan as per the Indus Waters Treaty, and the usurpation of the rights of lower riparian will be considered as an Act of War and responded with full force across the complete spectrum of National Power."