Morning Market Brief 17th Mar. 2021

Technical Overview

The Benchmark KSE100 index is moving in lower band of its Bollinger band on daily chart and right it would be considered under pressure or in correction mode until it would not succeed in closing above mid line of its Bollinger, currently that line fall behind two major resistant regions and before that level index is being capped by its 61.8% correction level on hourly and 50% on daily chart below 45,050pts region and a hammer or some kind of spinning top formation have been created on daily chart during last trading session therefore it's recommended to stay cautious during current trading session because if index would not succeed in breakout above its correction levels then it can start sliding downward to create an evening star formation on daily chart which would vanish impact of previous bullish engulfing formation. While breakout above 45,050pts would call for 45,300pts where index is being capped by supportive trend line of its previous bullish price channel and this region would try to react as strong resistance. For current trading session it's expected that index would try to open with a positive sentiment but would face some serious pressure during the day from its resistant regions therefore a volatile session could be witnessed and it's recommended to adopt swing trading strategy for day trading. On flip side in case of rejection from its resistant regions index would find initial support at 44,400pts from a horizontal supportive region while breakout below this region would push index towards 43,950pts.

Regional Markets

Asian stocks to open lower as investors eye Fed meeting

Asian stocks were set to open mostly lower on Wednesday following a sell-off in U.S. stocks, as investors awaited the Federal Reserve’s meeting and whether the central bank will maintain near-zero interest rates amid the economy’s post-pandemic recovery.Australia’s S&P/ASX 200 index lost 0.34% in early trading. Japan’s Nikkei 225 futures fell 0.20%, while Hong Kong’s Hang Seng index futures rose 0.34%. E-mini futures for the S&P 500 rose 0.13%. The S&P 500 and Dow Jones retreated late in the session on Tuesday as yields on longer-maturity U.S. Treasury bonds ticked up. This undercut investor optimism stoked by economic aid and vaccination drives. The Dow Jones Industrial Average fell 0.39% to end at 32,825.95 points, while the S&P 500 lost 0.16% to 3,962.71. The Nasdaq Composite edged up 0.09% to 13,471.57.Read More...

Business News

SBP unveils monetary policy today

State Bank of Pakistan is scheduled to announce its monetary policy statement here on Wednesday (today) for next two months determining its policy (interest) rate, which at present is 7 per cent per annum. The central bank has kept the interest rate unchanged since July 2020, when it was cut by 100 bps from 8% (1% cut). In January 2020, it was 13.25 %. For managing the critical economic situation emerging from COVID-19 pandemic, State Bank came for the relief and quickly reduced the rate down to 7% in three shots over period of four months. M Zubair Motiwala, a leading industrialist and textile exporter and former president of Karachi Chamber of Commerce and Industry, was of the view that the central bank should not increase its policy (interest) rate for keeping intact the scale of production and the exports of the country. Instead of raising the interest rate, SBP and the government should resort to other required measures to control inflation like ensuring the fair balance in supply and demand.Read More...

Import bill of eatables up by 50pc amid farm sector woes

The import bill of eatables ballooned by 50.29 per cent to $5.344 billion year-on-year during the first eight months of 2020-21 to bridge the shortfall in domestic production of agriculture produce. The higher-than-expected food import bill also triggered trade deficit which would cause some uneasiness on the external side for the government, data compiled by the Pakistan Bureau of Statistics (PBS) showed on Tuesday. The share of food items in the total import bill reached 15.76pc this year, compared to 11.29pc last year, making the country dependent on imports to ensure food security.The trade deficit is widening as the overall import bill of the country has been on the rise since November last year, mainly due to an increase in the import bill of eatables. The import bill inched up by 7.67pc to $33.897bn in eight months this year as against $31.483bn over the corresponding months of last year.Read More...

LSM recorded growth of 9.13 per cent in January

Pakistan’s large scale manufacturing (LSM) sector is continuously showing handsome growth during ongoing financial year, indicating the revival of industrialisation in the country. The LSM, which constitutes 80 per cent of manufacturing and 10.7 per cent of the overall GDP, has recorded growth of 9.13 per cent in the month of January over the corresponding period of the previous year. Meanwhile, the LSM has shown growth of 7.85 per cent in first seven months (July to January) of the current fiscal year, according to the latest data of Pakistan Bureau of Statistics (PBS) released on Tuesday. The LSM sector has rebounded from the start of current financial year after suffering due to Covid-19 last year. The LSM is showing massive growth on the back of non metallic mineral products, automobiles, food, beverages & tobacco, chemicals and pharmaceuticals.Read More...

Punjab govt plans to convert all public sector power connections on solar energy

Punjab government has a plan to shift all public sector electricity connections on solar energy in near future to promote clean and green energy vision of Prime Minister Imran Khan in the country. Official sources told APP here Tuesday that the provincial government had shifted 10,500 government schools on solar energy and now all the basic health units were being switched to solar energy in next stage. They said that the Punjab government has also a plan to shift all public sector universities on solar system besides converting all public connections on solar energy. They said that Zhenfa Pakistan New Energy Company was setting up 100MW solar power plants in Layyah district, which would further expedite economic activities in the remote area.Read More...