Morning Market Brief 11th Mar. 2021

Technical Overview

The Benchmark KSE100 index have given bearish breakout of its bullish price channel on daily chart but on weekly chart its yet not confirmed because this week's pull back above 45,000pts would convert weekly penetration into a cheat pattern of false breakout. . Currently there are two scenarios which are taking place most likely index would bounce back to retest its resistant regions at 45,000pts or 45,500pts and would try to amend its lows after facing rejection from these regions or completing its bearish corrections while alternatively if it would succeed in closing below 42,500pts on weekly basis then it would start sliding towards 39,500pts to complete ABC of its bullish elliot wave but these both scenarios would get clarity in next week therefore it's recommended to trade very cautiously during these two trading sessions of this week. Its recommended to stay cautious because index is being supported by a rising trend line which is supportive trend line of its ascending wedge on daily and weekly chart, and if index would succeed in giving a clear breakout of this wedge in downward direction then a major setback would push index further downward. For current trading session it's expected that index would try to start a pull back if it would not succeed in sliding below 43,200pts. It's expected that index would try to bounce back from current levels or after a dip between 43,500pts-43,300pts because its being supported by a strong horizontal supportive region along with 50% correction of its last bullish rally between these both levels. While breakout below 43,200pts would call for 42,800pts and 42,500pts where index would again try to establish ground against current bearish sentiment. It's recommended to start buying in chunks from today because index seems to start a recovery either from today or tomorrow to retest its previous supportive regions as resistant ones. Overall index would remain under pressure until it would not succeed in closing above 45,000pts on daily or weekly chart. Currently index would face initial resistance at 44,000pts which would be followed by 44,500pts.

Regional Markets

Asian stocks set to firm after Dow hits record

Asian stocks were set to open slightly higher, following Wall Street’s momentum, after a report on U.S. consumer prices calmed concerns about inflation, helping steer the Dow Jones Industrial Average to a record close.Japan’s Nikkei 225 futures added 0.02%. Hong Kong’s Hang Seng index futures rose 0.03%. Australia’s S&P/ASX 200 index gained 0.12% in early trading. E-mini futures for the S&P 500 rose 0.24%. “I do think we’ll see good support for Asian markets today across the region,” said Michael McCarthy, chief markets strategist at CMC Markets. “The reflation trade is back on. We saw bonds and stocks rallying together and a slight easing in the U.S. dollar, which also indicates improving sentiment.”The Dow Jones Industrial Average rose 1.45% to a record closing high, the S&P 500 gained 0.60% and the Nasdaq Composite dropped 0.04%. Europe’s main index hovered near pre-pandemic highs. MSCI’s gauge of stocks across the globe gained 0.09%. Gold erased earlier losses to hit a one-week high on Wednesday, as U.S. Treasury yields eased. Spot gold prices rose $0.1234 or 0.01%, to $1,726.17 an ounce. U.S. gold futures settled 0.3% up at $1,721.80.Read More...

Business News

KE consumers to get Rs2.35b relief

National Electric Power Regulatory Authority (Nepra) has approved a relief of Rs 2.355 billion in electricity tariff on account of fuel charges adjustments for 11 months (July 2019-May 2020) for the consumers of K-Electric. In its decision released here, Nepra has said that the Authority has approved the total impact of Rs.2,355 million on account of fuel adjustments, to be charged in the billing months of March, April and May 2021 and shall be applicable to all the consumer categories except lifeline consumers. Impact of negative FCA shall not be applicable to domestic consumers consuming up to 300 units and agriculture consumers of K-Electric. Negative adjustment on account of monthly FCA is also applicable to the domestic consumers having Time of Use (ToU) meters irrespective of their consumption level. K-Electric had requested monthly FCA from July 2019 to May 2020 having total negative impact of Rs1,480 million. However NEPRA has allowed a total negative impact of Rs.2,355 million on account of fuel adjustments, to be charged in the billing months of March, April and May 2021.Read More...

ECC okays Rs7.8bn Ramazan package for Utility Stores

The government on Wednesday increased commission for oil companies and their dealers on sale of petroleum products, allowed import of cotton from Afghanistan and Central Asian Republics through Torkham border and approved Rs7.8 billion worth of Ramazan package for Utility Stores. The decision was taken at a meeting of the Economic Coordination Committee of the cabinet presided over by Finance Minister Dr Abdul Hafeez Shaikh. The ECC also allowed provision of subsidised natural gas to two Punjab-based fertiliser plants — Fatima and Agritech — for nine months with additional subsidy of Rs2bn to Sui Northern Gas Pipelines Limited. The increase in dealers’ commission and profit margins of oil marketing companies (OMCs) came a day ahead of a strike call given by the dealers of petroleum products. The Petroleum Division had moved a summary for 6.8 per cent increase in margins for both segments in line with the rate of inflation.Read More...

Oil prices to go up as ECC okays increase in margins of OMCs, dealers

The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved to revise upwards the margins of oil marketing companies (OMCs) and dealers on petroleum products, which would increase the oil prices in the country. Petroleum Division updated the ECC about the recommendations firmed up by a sub-committee established in line with the earlier decision of the ECC dated Jan 28, 2021 regarding review of oil marketing companies (OMCs) and dealers margins on petroleum products. After detailed discussion, the ECC approved to revise OMCs and dealers margins on the basis of 85% of the latest average core inflation with immediate effect, and directed to expedite a study by PIDE. An official said that Petroleum Division had informed the ECC that the sub-committee had proposed a hike in margins of OMCs and dealers of petroleum products on an interim basis as the study had not been conducted so far. The committee had recommended that the government should give interim relief to the OMCs and dealers till the PIDE study is completed. The study is likely to conclude by June 2021.Read More...

Envoy for making Pak-Nepal agri ties stronger

Ambassador of Nepal to Pakistan, Tapas Adhikari Wednesday called on Minister for National Food Security and Research Syed Fakhar Imam and discussed issues related to mutual cooperation between the two countries. Both sides discussed the importance of agriculture sector in socio-economic development of region and stressed the need to enhance bilateral cooperation in the field of agriculture research and development. The minister also highlighted the need for enhancing mutual cooperation in other areas of economy for the betterment of Pak-Nepal relationship with respect to the agriculture sector. Speaking on the occasion, Ambassador of Nepal called for activating agricultural working groups of both the countries and organizing their meeting to make agricultural ties stronger. He said that last agricultural working level meeting was held over a decade ago, adding that regular meeting would help promote bilateral cooperation in agriculture research and development. During the meeting, the both sides also agreed for the advancement of agriculture sector of two countries, besides working to make bilateral relations of Pakistan and Nepal more cordial for the benefit of both the countries.Read More...