The KSE-100 index has been one of the best performing stock markets in Asia (yielded a return of 31% or 22% in dollar terms) since the beginning of the year but in the month of August, the index fell by 5%.
While the trend was dismal in the last month, a stock market crash is still not likely owing to the amnesty scheme enacted by the former government which will last till June 2014. This allows investors to continue to pour money into the stock market without having the origins of the funds questioned. This is also reason as to why seemingly unexpected recoveries have followed downturns in the recent past e.g. KSE-100 lost 690.8 points from August 1 to August 6 and a recovery followed whereby the benchmark index gained 615.2 points in the subsequent session on August 7.