KARACHI - The resignation of President Musharraf will bode well for the equity markets because such move of the president will pay the way for reducing the severe political uncertainty that has gripped the country over the last six months, when the anti-Musharraf parties (Bhutto's PPP and Sharif's PML-N) won the general elections held on February 2008, brokers and analysts said. Analysts were of the view that financial markets are expected to react positively to the new found political clarity with the political risk premium likely to decline. As a result capital markets to show a positive momentum, while some level of stability is also expected in the currency markets where Pak Rupee declined 5 per cent last week. At the same time analysts have shown their concerns that "if the vacuum emerged following the resignation of President Musharraf caused a new battle ground for the coalition partners, it would be disastrous for the share markets and country as well," Analysts hoped that both coalition partners would take all steps prudently and in the interest of the nation because country was going through intense financial crisis. Brokers said that since the foreign media reports of resignation of president came to the surface on last Friday, equity markets reacted positively and today's formal announcement of President Musharraf to resign his nine years reign has raised the confidence of investors. Analysts said that after the resignation of President Musharraf, mounting inflation, twin deficits, smooth governance and deteriorating law and order situation in the northern part of the country are the real test of the coalition partners. Analysts pointed out that the benchmark KSE-100 index had touched its peak since the beginning of current coalition government but as soon as the political uncertainty took its toll, the stock market witnessed decline of approximately 37 per cent. Coalition partners have depicted President Musharraf depicted as a main hurdle in a way of smooth political process, so after his resignation both coalition partners have to get down to taking serious steps to boost up the economy and maintain law and order situation, brokers said.