What to do about a bear market? In Pakistan, you stone it
And Wall Street thinks it has problems.
Investors in Pakistan rioted at stock exchanges in Karachi, Islamabad and Lahore on Thursday, protesting the 15th straight drop in share prices.
Bloomberg News reported from Karachi: "Police surrounded the exchange after hundreds of investors stoned the building and shouted anti-government slogans. Securities and Exchange Commission of Pakistan, which imposed and then removed a 1% daily limit on price declines this week, had attempted to halt a slide that wiped out $30 billion of market value in three months, threatening to undo a 14-fold rally since 2001."
The Karachi 100 index dived 2.7% on Thursday to 10,212.92. The nonstop decline since June 26 has hacked 18% off the index. It’s down 35% since reaching a record high of 15,676 on April 18.
The market has plummeted amid concerns about disputes within the ruling government coalition. See the full Bloomberg report here.
Long market losing streaks are nothing new in Asia this year. The Vietnamese stock market slid for 25 straight sessions ending on June 11. In Japan the Nikkei-225 index fell for 12 straight sessions through July 4, its longest run of red ink since 1954. In general, foreign markets have fared worse than Wall Street over the last year.
Many Asian markets enjoyed spectacular bull runs from 2003 through last year, riding the economic booms of China and India. Now, investors are giving a lot of those gains back, and they don’t like it.
From Bloomberg's Karachi report: "We demand that all stock prices be frozen at current levels," said Kauser Javed, who heads the Small Investors Assn. "People have sold their assets in the last 15 days to meet payments and if things continue this way, you will start hearing of suicides. The regulators always favor big brokers and investors."
Welcome to our world, Mr. Javed.
Photo: Burning tires outside the stock exchange in Islamabad. Aamir Qureshi / AFP/Getty Images