Morning Market Brief 29th April. 2021

Technical Overview

The Benchmark KSE100 index had faced rejection from a strong horizontal resistant region after an intraday spike during last trading session and had continued its bearish journey which initially seems correction of its last bullish rally but it's recommended to stay cautious because if index would succeed in sliding below 44,900pts then this corrective wave would convert into a bearish rally which may prolong initially towards 44,750pts and 44,500pts. Daily closing below 44,500pts would push index into a bearish zone therefore it's recommended either to adopt wait and see strategy or selling on strength with strict stop loss for day trading. On flip side in case of reversal towards bullish side index would face initial resistance between 45,200pts-45,350pts which would be followed by 45,500pts, index would remain range bound until its caged between 44,500pts to 45,500pts while breakout above 45,500pts would call for 46,200pts. Meanwhile closing below 44,500pts would push index towards 43,500pts in coming days. Currently hourly momentum indicators are in bearish mode and these are being supported by daily MACD as well therefore it's recommended to wait for a clear formation on candle stick side to initiate new long positions.

Regional Markets

Asia shares rise on supportive Fed as Biden unveils new stimulus

Asian shares rose in early trade on Thursday after the U.S. Federal Reserve said it was too early to consider rolling back emergency support for the economy, and as U.S. President Joe Biden unveiled plans for a $1.8 trillion stimulus package. Fed Chair Jerome Powell said on Wednesday that "it is not time yet" to begin discussing any change in policy after the U.S. central bank left interest rates and its bond-buying programme unchanged, despite taking a more optimistic view of the country's economic recovery. Powell's comments came before Biden's unveiling of a sweeping package for families and education in his first speech to Congress. Excerpts of Biden's speech released in advance by the White House "hit the high points - big infra(structure) spend, talking climate action and vaccines," said John Milroy, investment adviser at Ord Minnett. "The Fed remains dovish, all very supportive." Early in the Asian trading day, MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.1%. Australia's S&P/ASX 200 edged up 0.31%, as strong oil prices lifted energy stocks. China's blue-chip CSI300 index was 0.65% higher in early trade. Hong Kong's Hang Seng index opened up 0.7%, Seoul's KOSPI added 0.37% and Taiwan shares rose 0.48%. Markets in Japan were closed for a holiday but Nikkei futures edged 0.05% higher to 28,970.Read More...

Business News

ECC approves release of RLNG subsidy for export-oriented industry

The Economic Coordination Committee (ECC) of the Cabinet has approved to release the subsidy for the supply of 100 per cent RLNG to export oriented industry for the month of March 2020. Federal Minister for Finance and Revenue, Shaukat Fayyaz Ahmed Tarin presided over the meeting of ECC of the Cabinet. Power Division submitted a summary regarding the release of subsidy for the supply of 100 per cent RLNG to export oriented industry for the month of March 2020. The ECC approved the summary and decided to form a sub-committee consisting of Adviser to PM on Commerce, SAPM on Power and other relevant stakeholders to review the power subsidies provided to export oriented sectors, with a direction to submit a holistic proposal before the ECC. Read More...

Nepra likely to reduce power tariff by Re0.62-0.68 per unit for March

Chairman Nepra has said that the electricity consumers can get a relief of Rs 0.62 to Rs 0.68 per unit under the fuel charges adjustment for the month of March. Presiding over a hearing on CPPA-G petition for the reduction of 0.61 per unit, chairman Nepra questioned that why expensive furnace oil was used for power generation in March? Why less energy from gas was generated in the month, he further asked. Official of NPCC informed that there were technical problems as there were interruption in RLNG supplies for the power plants, that’s why furnace oil was used during the month. Chairman Nepra asked the petitioner to provide justification for use of furnace oil and under utilisation of some power plants. Chairman Nepra said that the tariff can be decreased by Rs 0.62 to Rs 0.68 per unit for the month of March. However decision in this regard will be issued later. If approved the decrease will provide a relief of Rs 5.4 billion to power consumers.Read More...

ADB puts Pakistan growth rate at 2pc this year

The Asian Development Bank (ADB) on Wednesday forecast Pakistan’s GDP would grow by two per cent during the current year subject to successful vaccine rollout and implementation of stabilisation measures. “Assuming successful vaccine rollout and the implementation of economic reform under a stabilisation programme with the International Monetary Fund (IMF), GDP is expected to grow by 4pc in FY2022 as consumption strengthens and investor confidence improves,” the ADB said in its flagship Asian Development Outlook (ADO) 2021. However, the economic outlook is subject to downside risks, depending on persistent containment measures and success in achieving the vaccination target of 70pc of the eligible population by the end of December 2021.Read More...

Tarin defers decision on IPP payments, LNG subsidy

In his maiden meeting of the Economic Coordination Committee (ECC) of the cabinet, Finance Minister Shaukat Tarin deferred taking a decision on two crucial agenda items — payments to independent power producers (IPPs) and how to go ahead with subsidy on LNG supplies to export industries. Presiding over the ECC meeting, the newly inducted finance minister constituted two smaller groups on both subjects to have focused discussions. A cabinet member said Mr Tarin appeared to have certain reservations over handling of the IPPs, but noted that the deals had already been finalised.Read More...