KSE cuts lower lock limit, raises upper lock limit

KARACHI - In a bid to bring the stock market out of current turmoil and to provide breathing space to the brokers and investors, the KSE has decided to reduce the limits of lower lock from five per cent to one per cent and increase the limits of upper lock from five per cent to 10 per cent.
The KSE management has also decided to impose ban on short selling in futures along with accepting the bank guarantee for cash margin. The amendments will be valid for one month.
The decision was taken in an important meeting held between the SECP and the KSE here on Monday in the backdrop of the unabated trend of massive erosion in the index and capitalization of Karachi Stock Exchange, sources told The Nation.
In the meeting the Securities and Exchange Commission of Pakistan and Karachi Stock Exchange management have also decided to jointly launch a market stabilization fund soon in line with the international market stabilization fund to boost up the sentiments of the investors.
"If the KSE had taken such steps earlier, the massive erosion in the index and capitalization witnessed in the stock market for the last 2 months, could have been averted," brokers said.
The recent turmoil in the market has seen the index plunge by nearly 4,000 points in the last 2 months,