Pakistani lawyers to press government

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As the politicians tussle over the judges and who will replace Musharraf as president, violence has been surging in the northwest where security forces are battling militants in several areas and the militants are striking back with bombs.

Government soldiers backed by air strikes killed nearly 50 militants in heavy clashes in the northwest on Wednesday, while on Thursday, a car bomb blew up a police bus near the town of Bannu, killing nine policemen and two passers-by, police said.

Musharraf's support for the U.S.-led campaign against terrorism was deeply unpopular with many Pakistanis but Zardari, who is seen as close to the United States, has vowed to press ahead with the effort.

Washington, an important source of aid for Islamabad, says al Qaeda and Taliban militants orchestrate violence in Afghanistan, Pakistan and the West from sanctuaries in the northwest.

Nervous investors withdrawing their funds from Pakistan in the face of violence and political instability have sent the country's financial markets skidding lower.

The rupee has lost about a quarter of its value against the dollar this year. Pakistan's stock market, which rose for six consecutive years to 2007 and was one of the best-performing markets in Asia in that period, has fallen about 30 percent.

Struggling to halt the slide, stock exchange authorities announced early on Thursday they were setting a floor for the index at Wednesday's closing level.

Some dealers said the move would help confidence, at least in the short-term, and the index opened more than 1 percent higher before slipping back slightly.

Some dealers hope a September 6 presidential election, when members of the country's four provincial assemblies and two-chamber national parliament vote for Musharraf's replacement, will bring some clarity to the political outlook.

Bhutto's party has nominated Zardari while Sharif's has put up a former Supreme Court judge, Saeeduzzaman Siddiqui.

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