India, Pakistan stocks fall after Kashmir strikes

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Mumbai, Sept 29, 2016 (AFP) -Indian stock markets slumped almost two percent on Thursday after the army said it had conducted “surgical strikes” along the de-facto border with archrival Pakistan in Kashmir.

The Bombay Stock Exchange slid 534.70 points, or 1.84 percent, to 27,770.32 in afternoon trade after India said it had carried out the strikes to thwart attacks on some of its biggest cities. India’s National Stock Exchange slid 1.75 percent, or 152 points, to 8,592.25.

Across the border, the benchmark Pakistan Stock Exchange fell 0.37 percent, or 147 points, to 40,207 following the border strikes, reversing early gains of some 500 points on OPEC’s decision to cut oil output.

“Panic gripped investors over the uncertain conditions on the Indian border and they pulled out from the market,” said Azam Khan, chief executive officer of Sunrise Capital Private Limited.

Lieutenant General Ranbir Singh, India’s director-general of military operations, said the strikes had been carried out along the unofficial border that divides the disputed territory on Wednesday night, provoking a furious reaction from Pakistan. Pakistan’s military said two of its soldiers had been killed in what it called “cross-border fire” while Prime Minister Nawaz Sharif condemned what he called India’s “naked aggression”.

The strikes come after the Indian government accused Pakistan-based militants of launching a deadly assault on an army base in Kashmir earlier this month that killed 18 soldiers.

India has been on a diplomatic drive to isolate its archrival and fellow nuclear power since the raid on September 18, the worst such attack in more than a decade.

Kashmir has been divided between India and Pakistan since gaining independence from Britain seven decades ago. The countries have fought two of their three wars over the territory.

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