PSX: Post Covid-19 - Did It Rise or Crash Globally?

Stock stats

An unanswerable question hides behind the economic ruins and the tattletale to these tracks is fading away with the pandemic effect.

The COVID-19 effect or as we call it the destructive force of pandemic, has made global economies kneel to the financial and health sector crises. Unemployment cheques have been flying since the start of pandemic and those who applied for unemployment have been getting the designated benefits. However, for those who have to make every payment out of pocket, things haven’t been easy and the tyrannical clutches of COVID effect has claimed many lives and businesses.

The Reflection of Global Effect

This effect is accurately reflected on the global level and therefore is also visible for all countries on a national level. Moreover, countries with crippling economic infrastructure were already looking for bail outs when the pandemic hit and that has only added enormously to their problems. Things were not looking exactly good in the start of march but for some countries now the economic indicators are showing a growth curve such as that of stock exchange in Pakistan.

PSX - Stock exchange in Pakistan

Pakistan stock exchange has been recently termed as the best performing in Asia and the fourth best around the world. The news has been regarded as a breeze of fresh air by the economists who have been seeing plummeting figures for long. It was only back in 2016 that Pakistan achieved this status and now four years later, the tide has turned but is this a sustainable development or just a volatile pulsation? The answer to this question lies in consideration of multiple factors. Factors such as
  • Recovery from corona virus,
  • Increase in remittances which by the way has reached a record high
  • Trust buildup of investors
All have something to contribute in the winning punch.

The fact that most of the world is still entangled in a whirlpool that is continuously sucking in small economies and a global blow to the health sector along with loss of lives, has made other economies look bad too. though the pandemic effect is surely a thing to notice but it doesn’t undermine the importance of a good performing market where numbers are going up the hill such as PSX.

Following the fluctuation

Every day, there is a slight fluctuation which is perfectly normal as determined by the standard operating procedures. The upward curve on the growth graph is descriptive of the economy’s direction and reflective in the equity market too. Most of the foreign investors who were only stuck to net selling turned their eyes towards net buying too in the month of August 2020 and this hints towards the prosperity that sane and cleverly thought of economic decisions are to bring about.

Not a lone achievement

These meticulously planned monetary and fiscal policies have too been a great part of the effort that started long before the pandemic. Here you should also understand and assess that it’s not only stock exchange in Pakistan that has been performing exceptionally well but the World’s greatest economy – The United States of America. For the American nation, it is the stimulus package, quantitative easing, or simply printing more money to tackle the hungry economy, that has provided support to plummeting figures.

Assessment of returns in the month of July and August revealed that there was a generation of 14.05 % and 4.72% respectively. This also surpasses the least minimum required to say that economy is boosting adequately.

For those of you who have been following the fluctuating market since long know that it was only in 2016 that we saw the halcyon days but next year, PSX was also termed as the worst performer globally.

It would neither be wise nor be sane for the government to believe that no amount of turmoil could make a hole in the economic wall because taking decisions without testing waters would be an extremely ungrateful act.

Experts who were not only privy to the government policies but also well acquainted with the growing foreign confidence, knew that this boost was coming and all the adulation and praise of a country like Pakistan is in turn due to preemptive measures taken. The global dilemma stretches across many nations and if care is not taken as required then PSX may soon find itself submerged in deep and explored waters.

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