News of Tuesday's arrest spread quickly in Karachi, where Hussain's Muttahida Qaumi Movement party has dominated political affairs for over 30 years. A visible state of panic was evident; stores closed early and commuters returned home, causing chaos and traffic jams, in fear of street violence. The burning of at least six vehicles was reported.
The Karachi Stock Exchange fell 780 points -- or about 2 percent of its value -- before recovering. Meanwhile, the British diplomatic mission in Karachi was temporarily closed.
Although Hussain has lived in London since 1992, he remains a charismatic and powerful figure in his party in Pakistan. The internal strength of the party, which has enormous support in Karachi, will likely be tested by his arrest. It exerts influence through its control of national parliamentary seats for Karachi, as well as armed street gangs that patrol neighborhoods of the city.
Hussain's arrest came after his office was raided in 2012 and $600,000 in cash was impounded. A recent investigation into the deaths of two men, allegedly killed by Pakistan's military intelligence agency, brought further examination of Hussain's finances.
London police said Hussain had not yet been removed from his home because of his ill health.