KARAHI - The business community and economic experts have termed the disqualification of Sharif brothers a "big domestic political upheaval" which would derail the process of economic growth, hurting the pace of industrial development and production activities. "The capital market of Pakistan would face another fresh wave of political uncertainty, carrying potential risks for the positive and improved macroeconomic outlook. Therefore, the next few months are going to be crucial for the overall prospects of the economy", economic experts told TheNation on Wednesday. The first victim of the disqualification's decision was the Karachi Stock Exchange. Before the announcement of the decision, the KSE was moving in the positive zone, but as the news of disqualification hit the market, the equities hit the lower locks, landing the investors into a serious problem. The KSE-100 index quickly lost 294 points and it closed at 5580 points. In other words, the KSE 100-index lost 5 per cent of its worth immediately after the announcement of the SC verdict. The stock market analysts are of the opinion that the market could face selling pressure for another couple of days because of political uncertainty triggered by the disqualification of Sharif brothers. The stock market witnessed a positive trend in the morning session on Wednesday by gaining above 50 points and a massive change in political activities altered the whole scenario that threw the shares to the bottomline, said Shahid Ali, CEO Habib Metropolitan Financial Services (HMFS). The investors offered for sale their stakes but the buyers sidelined from the market while anticipating more erosion in the value of equities. The volume of KSE-100 index stood at 145.42 million shares, slightly higher than 135.55 million shares traded a day before. However, the market capitalization fell to 36.89 billion dollars (0.94 per cent) on Wednesday when compared with 37.24 billion dollars on Tuesday. The OGDC was the volume leader with trading of 22.238 million shares while second and third volume leaders were NIB 10.418 million shares and Hubco 8.481 million shares, respectively. The shares of 248 companies suffered setback and their value declined soon after the announcement of the decision. Only 23 companies shares gained a slight value. According to market experts, the market began trading with positive sentiment amid reports of the announcement of good corporate results of the listed companies. But the stock market faced a big blow when the news of disqualification reached the investors. The stock market could face more erosion and decline in the remaining two sessions of the current week and the KSE-100 index could skip below 5000 points as the political instability has taken away the trust of investors. "Fear of political turmoil has changed the investment drift", analyst said. Analysts said that the dull activity found an escape goat in the shape of massive change in the political scene and panic selling emerged in the absence of aggressive buyers on dips that led to the price erosion that triggered selling pressure. Within no time the index registered downward adjustment of 5.01 per cent, thus endorsing the view that local bourses are shallow, where followers are large in numbers and initiators are numbered, an analyst said. "The timing of this decision is quite crucial. It has been come out when a top-level delegation of Pakistani officials are being engaged in talks with IMF Staff for the releasing of worth 775 million dollars-second tranche of the Fund's loan. The heads of major trade and industrial bodies are of the view that the growth in foreign investment is likely to decelerate in the forthcoming weeks due to increased country risk which could shift the foreign investment to other regional countries. Chairman Korangi Association of Trade & Industry (KATI), Mian Zahid Hussain while talking to TheNation said, "For achieving economic prosperity and growth, political instability is significant to maintain", he added. A representative of All Pakistan Textile Mills Association (APTMA) said, "This move has wrecked the government's efforts of creating the environment of political reconciliation and harmony amongst all political stakeholders. Driven by structural problems like energy, power shortages, increasing imported input cost, high mark up are being squeezed the growth in the manufacturing sector". The economy had started to show signs of improvement since the initiation of this year as the benefits of all the measures taken by the govt under its macroeconomic stabilisation programme. The outcome of this development can be evaluated easily by all segments of the society and economy from a consumer to the manufacturer, an economist to a common man. Besides the political issues, even on the economic and financial front, the strategies adopted by developed economies, such as offering stimulus packages including tax cuts and reducing interest rates to reinvite economic activity, seems to have clearly failed to inspire the local authorities. "In the prevailing scenario, massive reduction in purchasing power and high cost of production have already forced a likely reduction in the GDP and tax collection targets, any further tightening (increase in taxes) will suffocate the local businesses. To provide a jump-start to the dull economy relaxations seem necessary, transferring the adjustment in the commodity prices and offering tax cuts (recently done by India) can certainly provide the desired stimulus to the economy", stated Hasnain Asghar Ali of Aziz FidaHusein & Co. Meanwhile, the KSE-30 shed 308.79 points to close at 5,685.44 points while KMI-30 also dipped down 390.55 points and wrapped up at 7,371.54 points. At KSE, Gatron Industry, Central Insur and Berger Paints gained their values by Rs 2.51, Rs 1.91 and Rs 1.59 closed at Rs 52.71, Rs 48.90 and Rs 33.59 respectively. Pak IntCon (Pref), Resham Textile and Crescent Textile also secured their values by Rs 1.00, Re 0.98 and Re 0.96 closed at Rs 9.00, Rs 8.83 and Rs 30.50 respectively. On the other hand, Nestle Pakistan, Rafhan Maize and Unilever Pak Ltd shed their values by Rs 44.23, Rs 35.00 and Rs 12.21 closed at Rs 840.00, Rs 1360.00 and Rs 1817.80 respectively. Shezan Inter Ltd, Attock Petroleum and Pak Services Ltd also reduced their values by Rs 11.24, Rs 11.20 and Rs 9.38 closed at Rs 213.65, Rs 212.95 and Rs 178.83 respectively. Sapphire Fiber Ltd, Millat Tractors and Shell Pakistan also dipped down and lost their values by Rs 9.25, Rs 8.55 and Rs 7.69 closed at Rs 175.77, Rs 182.80 and Rs 183.80 respectively.