(26th August, 2015)
Pakistan’s growing economy is stable enough to stand up to the global and local stock market downfall emerging from China, the world’s second-largest economy, a business leader said Wednesday.
The local stock market panic appeared to be easing following a dramatic sell-off by investors who blindly followed foreign investors to overreact, said President Pakistan Businessmen and Intellectuals Forum (PBIF) and former provincial minister Mian Zahid Hussain.
Ups and downs in the stock markets is a normal phenomenon and some volatility was likely to continue but the recent falls had been overdone, he added.
Talking to business community, he said that stock market should not be considered real economy and it should not be linked to GDP.
He said that the crisis took birth in China where the market is still 50 percent higher than the corresponding period.
Local brokers and investors shouldn’t have followed foreign investors who have only 10 percent in market capitalisation and 30 percent share in free-float shares; they have a different mentality and different goals, he added.
Mian Zahid Hussain who is also President of All Karachi Industrial Alliance said that those comparing China crisis with global economic crisis of 2008 are pessimistic.
He said that government should keep an eye on stock market, dollar and those trying to manipulate the situation, improve existing guidelines and laws and overcome mafia which deprived masses of billions is the stock market crash seven years ago.
He said that despite some anxiety, the Pakistan’s stock market which has climbed by 12 percent in 2015 will continue bullish trend if reforms were introduced immediately.