Morning Market Brief 21st April. 2021

Technical Overview

The Benchmark KSE100 index is caged in a triangle on daily chart and had created a bullish engulfing pattern on daily chart but it's recommended to stay cautious and wait for confirmation of this bullish pattern because if index would not succeed in giving a breakout above 45,550pts during current trading session then this pattern could convert into a cheat pattern. Meanwhile index is being capped by two strong resistant elements at 45,550pts and 45,710pts from where it could face rejection if some fresh volumes would not pop up therefore it's recommended to post trailing stop loss on existing long positions. While on flip side in case of rejection from its resistant regions index would try to establish support initially at 45,000pts while breakout below this region would push index towards 44,600pts. Daily momentum indicators are in mixed mode but hourly stochastic and MAORSI are ready for bearish crossovers after creating a bearish engulfing pattern at day end yesterday therefore it's expected that index may take a dip to adjust those indicators, meanwhile hourly MACD have started losing strength and these elements are indication that if index would start sliding downward then this dip would not stop till intraday basis and may this bearish sentiment prolong till this weekend.

Regional Markets

Asian stocks fall as virus worries return to haunt markets

Asian shares and U.S. stock futures fell on Wednesday as concern about a resurgence of coronavirus cases in some countries cast doubt on the strength of global growth and demand for crude oil. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.6%. Australian stocks dropped 1.25% and shares in China were down 0.46%. Stocks in Tokyo slumped by 1.79% due the growing likelihood that Tokyo, Osaka and surrounding areas will be put on lockdown due to a new wave of coronavirus infections. S&P 500 e-mini stock futures also fell 0.18%. Crude futures extended declines from a one-month high in Asian trading on speculation that coronavirus restrictions in India, the world's third-largest oil importer, will hurt energy demand. Declines in Asian shares followed a downbeat day on Wall Street. The Dow Jones Industrial Average fell 0.75%, the S&P 500 lost 0.68%, and the Nasdaq Composite fell 0.92% on Tuesday as investors sold airlines and travel-related shares due to fear of a delayed recovery in global tourism.Read More...

Business News

Govt approves centralised database plan for food stock

The cabinet on Tuesday decided to establish a centralised database to maintain record of stocks of essential food items available with the federal and provincial governments to ensure the country does not face shortage. The cabinet meeting, which was presided over by Prime Minister Imran Khan, also took several other decisions, including deferring a proposal to exempt Kartarpur (Sikhs’ religious site) project from the Public Procurement Regulatory Authority (PPRA) rules and allowing transportation of Unicef trucks from Karachi port to Kabul. “During last year’s wheat and wheat flour shortage, it came to the notice of the federal government that there was no database available to check how much of the commodity was available in the country and where, therefore the cabinet decided to maintain a databaseRead More...

Railway project sent to Chinese bank for approval of $6bn loan

The Chinese government has sent Pakistan’s first modern railways’ infrastructure project — Main Line-1 (ML-1) — to the Exim Bank of China for approval of a $6 billion loan after all technical, administrative and other issues have finally been resolved, paving the way for launching civil work on this scheme within this year. “The latest on the $6.8 billion ML-1 project is that a finance committee comprising Chinese officials has sent the case related to $6 billion loan approval of the project to Exim Bank. Since the remaining $800 million will be provided by the government of Pakistan as equity, the total $6.8 billion will be spent on completion of the entire rail-related infrastructure, mainly the line, fencing, civil works etc,” Pakistan Railways Federal Secretary / Railway Board Chairman Dr Habibur Rehman Gillani said while talking to Dawn on Tuesday.Read More...

Circular debt plan outline shared with WB

Pakistan on Tuesday shared with the World Bank a revised outline of the Circular Debt Management Plan that seeks rationalisation of taxes, negotiated takeover of old independent power plants (IPPs) and closure of all old public sector plants to increase electricity tariffs, but slightly lower than that committed with the lenders under the IMF programme. This was the takeaway of a virtual meeting newly appointed federal Minister for Finance and Revenue Shaukat Tarin-led team of economic ministers and officials had with Managing Director (Operations) of the World Bank Axel van Trotsenburg. Federal Minister for Economic Affairs Omar Ayub Khan, Minister for Power Hammad Azhar, Special Assistant to the Prime Minister on Power Tabish Gauhar, SAPM on Revenue Dr Waqar Masood, the secretaries of finance, power and economic affairs divisions, Federal Board of Revenue chairman and State Bank of Pakistan governor attended the meeting.Read More...

Govt cuts provincial share under NFC Award by Rs153 billion

The share of revenue transfer to the provinces under the National Finance Commission (NFC) Award has been reduced by Rs153 billion following the reduction in tax collection target of the Federal Board of Revenue. The federal government has projected to transfer Rs2721 billion to the four provinces in ongoing financial year as against Rs2874 billion, which was estimated at the time of annual budget. However, the government has revised downwards the provinces shares after FBR’s tax collection has reduced. Pakistan had agreed with the International Monetary Fund (IMF) to downward revised the tax collection target by Rs272 billion to Rs4691 billion. In annual budget, the federal government had projected to transfer Rs2873.72 billion to the four provinces under the National Finance Commission (NFC) Award in the budget for the fiscal year 2020-2021. Read More...