Karachi Stock Exchange (KSE)
Karachi Stock Exchange (KSE) got one of the worst jolts in a long time after Indian air raids on Balakot in Khyber-Pakhtunkhwa.

Hammered by geopolitical tensions, the Karachi Stock Exchange has remained volatile since the Indian Air Force (IAF) hit of a terrorist training camp in Balakot to avenge the suicide attack on Pulwama in Jammu and Kashmir.

The benchmark KSE100 index had tanked almost 1,500 points on Wednesday over news of escalating tension on the line of control (LoC) marked by retaliatory air raid from Pakistani Air Force (PAF) and reports of aircraft loss on both sides. It recovered a bit taking the cue from more conciliatory comments from leaders of both nations to close 785 points down at 38,821.

Karachi city
The panic reaction of small traders put pressure on the Karachi Stock Exchange (KSE) driving KSE-100 nearly 1,500 points down at one point after the Indian air raid on a terrorist training camp in Balakot, Khyber-Pakhtunkhwa.

The market opened on Wednesday with the index showing a loss of 184 points in the first half hour, according to the Dawn newspaper. As panic rose, individual investors started to jettison shares at whatever the available price which sent the index reeling down 1,490 points.

According to observers, Wednesday's was the largest decrease in the last 55 trading days and was the first time in 32 sessions that the Index had dropped below 39,000 points, reports say. Calm returned by the end the of the day after the National Clearing Company of Pakistan report showed foreigner remained net buyers having bought shares worth $1.56 million.

Banks, companies and mutual funds also stood on the sidelines, fighting the urge to give way to risk over greed, according to reports.

Tension between India and Pakistan after terrorist attack.
The February 14 terror strike in Pulwama in Jammu and Kashmir has ratcheted up tensions between India and Pakistan leading to tit-for-tat air raids across the line of control (LoC) in Kashmir.

On Thursday also the KSE-100 index saw an early loss of 128 points or 0.33 percent to touch 38,692.69 points. It started with brokers receiving a flurry of sell orders as TV screens flashed with news of shooting down two Indian jets that violated Pakistan's airspace. Fearing a full-scale war, investors dumped stocks, which saw the KSE-100 index tank by intraday low of 1,491 points.

Analysts at Topline Securities told Dawn that it was the most prominent intraday recovery triggered by Pakistan Prime Minister Iran Khan's conciliatory voice since July 28, 2017, the day Supreme Court disqualified former Prime Minister Nawaz Sharif from office.

Small investors took the biggest hit after the rapid triggering of margin calls. According to the National Clearing Company figures, individuals disposed of equity worth $5.85 million. Mutual Funds, which had been quiet the earlier day, went on to reduce positions of net $2.87 million to meet redemption calls as well as to shield their ''Capital protected funds'', the reports say.

MiG-21 wreckage
One of the pictures of plane wreckage that Pakistani authorities released saying it belonged to a MiG-21 of the Indian Air Force (IAF) that was shot down by a Pakistan Air Force (PAF) fighter jet over the line of control (LoC) in Kashmir.

Banks and large caps were the stabilizing factors absorbing much of the selloff at rock bottom valuations. Banks bought shares worth net $3.67 million and large companies accumulated stocks worth $2.23 million.