KARACHI: The bloodbath continued from last week on fears over vulnerable economic position and global meltdown, with KSE-100 Index falling by 4.4% WoW or 1,708 points to 37,518 points. Index took a breather during midweek on Pakistani Rupee depreciation, but could not hold on to it due to economic concerns and foreign selling. On economic front, Pakistani Rupee depreciated by 7% during the week against the Greenback to 133.6. State Bank of Pakistan (SBP) communicated that this adjustment corresponded to Current Account Deficit (CAD) and demand-supply gap in foreign exchange market. It expected that weaker Pakistani Rupee, interest rate hikes and other policy measures for reducing imports would improve external account position. State Bank of Pakistan’s (SBP) forex reserves continued to fall, declining by USD101mn (1.4%WoW) to USD8.3 billion (import cover: 1.4months). Goods’ Trade Deficit declined by 2%YoY to USD8.9bn owing to quantum of absolute growth in Goods’ Exports (USD194mn; 5%YoY) exceeding that of Goods’ Imports (USD90mn; 1%YoY). Pakistan formally requested International Monetary Fund (IMF) for financial assistance to address economic challenges. IMF’s Managing Director Christine Lagarde said that a team would be sent to Pakistan in coming weeks to initiate discussions for a possible economic program. She added that they required complete transparency of debt causing fears over China Pakistan Economic Corridor (CPEC) details which have been shrouded in mystery. Foreign investors ramped up their selling with net outflow of US32.6 million during the week amidst emerging market outflows. On domestic front, Companies, Insurance companies and Banks mopped up shares worth USD22.8 million, USD6.5 million and USD6.3 million, respectively. “We expect market to remain bearish owing to economic crisis and capital outflows from emerging markets. The latter is likely a result of US interest rate hikes and anticipated global economic slowdown associated with global trade wars. The quarterly financial results are not expected to ignite investors’ interest as they are expected to remain dull on average due to waning aggregate demand and rising cost of business with weaker PKR”, said an analyst at Elixir Research Department. Published in Daily Times, October 14th 2018.