Morning Market Brief 1st Sep. 2020

The Benchmark KSE100 index is moving in an upward price channel on hourly chart and have face a slight resistance from its previous top of 40,117pts during last trading session but sentiment is still bullish as index have rejected effects of previous weekly evening shooting star by creating a bullish engulfing pattern. As of now it's expected that index would try to continue its bullish journey towards 41,340pts initially while breakout above that region would call for 41,500pts and 41,760pts, while it would face major resistance between 42,000pts-42,200pts. While on flip side in case of bearish pressure index would try to find ground at 40,780pts where a strong horizontal supportive region would try to push index in upward direction followed by a strong supportive region at 40,445pts.
It's recommended to stay cautious and trade with trailing stop loss because daily and hourly momentum indicators are slightly under pressure as MACD have turned its direction towards bearish side on both time frames and if it would not start recovery then index start sliding any time. Meanwhile stochastic is trying to generate a bullish crossover on hourly chart which would try to pump some fresh volumes but daily stochastic seems turning down which could be dangerous if MACD would not start a pull back.

Asian factories continued to shake off the coronavirus-induced gloom in August as more bright signs in China raised hopes of a firmer recovery in global demand, reducing pressure on policymakers to take more radical steps to avert a deeper recession. Manufacturing activity in China expanded at the fastest clip in nearly a decade in August, as factories ramped up output to meet rebounding demand, a private survey showed. New export orders rose for the first time this year. The upbeat findings contrasted with an official survey on Monday, which showed China’s factory activity grew at a slightly slower pace in August.Read More...

The government has failed to improve the financial condition of public sector entities (PSEs) as their debt and liabilities had surged to Rs1.711 trillion by the end of June this year. The PSEs debt and liabilities had almost increased by Rs90 billion in last fiscal year taking the overall debt stock to Rs1.711 trillion, showing annual growth of 5.5 per cent. The debt and liabilities were Rs1.3 trillion in 2018 when the incumbent government had taken the charge. However, it had gone up by Rs400 billion in two years of the incumbent government, according to the latest data of State Bank of Pakistan (SBP).Read More...

The government has started the collection of Gas Infrastructure Development Cess (GIDC) and first instalment of the cess from Industrial and commercial consumers will be completed in September. According to documents, various sectors including fertilizer companies, government power companies, IPPs, K-Electric, generals industry, gas companies owes Rs523.60 billion in lieu of Gas Infrastructure Development Cess and the government will collect the amount in 24 instalments. The collection of first instalment will be completed in September 2020 and this amount will be used in the development of gas infrastructure projects in the country, said a spokesman of the Petroleum Division here.Read More...

Adviser to Prime Minister on Finance and Revenue, Dr Abdul Hafeez Shaikh said Monday that world community’s support was imperative to deal with the situation arising out of COVID-19 to mitigate the sufferings of the people. He was speaking at a webinar organised by Asian Development Bank (ADB) and United Nations Economic and Social Commission for Asia and the Pacific (ESCAP). He said that debt relief by the developed countries to developing countries would be a timely and positive initiative. The advisor appreciated the debt relief provided to Pakistan by Group 20 countries, International Monetary Fund (IMF), Asian Development Bank (ADB) and World Bank (WB). He said that world cooperation was needed to cope with the challenges faced by the developing and low income countries due to coronavirus outbreak.Read More...

The government has decided not to change petroleum prices for the month of September, according to a press release issued on Monday. Last week, informed sources had said the government would increase the prices of petroleum products by Rs8-9 per litre after increasing the levy on petrol and diesel. But "Prime Minister Imran Khan did not approve the recommendation of Ogra (Oil and Gas Regulatory Authority), Petroleum and Finance Division for increase in prices", a statement issued by the premier's office said.Read More...