Morning Market Brief 31st Mar. 2021

The Benchmark KSE100 index had witnessed a volatile trading session yesterday and closed with a doji formation at day end. As of now it's expected that today index would try to start the day with a positive note as hourly stochastic have generated a bullish crossover but later on index would face strong resistances and those would try to push index into negative zone again. It's expected that index would face initial resistance at 44,800pts from its daily double top while breakout above this region would call for 44,900ptts-45,050pts region. While on flipside index would find initial support at 44,200pts which would be followed by 44,000pts and 43,900pts. Being last trading session of the month today's closing matters a lot as index is trading in a very crucial region because today's closing below 44,500pts would format an evening shooting star on monthly chart which would be a negative sign. Meanwhile index may format a morning shooting star on daily chart after yesterday's doji formation but for this purpose index needs to close above 45,100pts at day end today. It's recommended to stay cautious and selling on strength with strict stop loss of 45,200pts could be beneficial for day trading. Overall index is being caged in a very tight range and it can be said that index is caged in correction of correction therefore swing trading also could be beneficial until index either gave bullish breakout of 45,200pts or bearish below 43,900pts.

ADB approves $300 million loan to build hydropower plant in Pakistan

Pakistan has obtained another loan as this time Asian Development Bank (ADB) has approved a $300 million loan to finance the construction of a 300-megawatt hydropower plant that will increase the share of clean energy in Pakistan and improve the country’s energy security. In last week, the International Monetary Fund (IMF) had approved to release $500 million for Pakistan under extended fund facility. Meanwhile, Pakistan and World Bank had signed agreements worth $1.3 billion for social protection, improving human capital and building resilience in the country. On Tuesday, the ADB approved $300 million loan to finance the construction of a 300-megawatt hydropower plant. All these inflows would help in building the country’s foreign exchange reserves. Pakistan had already taken $7.208 billion loans from external sources in eight months (July to February) of the current fiscal year that helped to improve foreign exchange reserves and exchange rate stability. The amount of borrowing is 59 percent of annual budget estimates of $12,233 million for the entire fiscal year 2020-21. Read More...

The manufacturing industry has asked the government to allow the import of raw materials at reduced duties and taxes to enable them to compete with local vending and raw materials monopolies, and help keep the end products prices affordable for consumers. Local recyclers of CRC steel, steel forgings and aluminum have increased prices significantly in the past few months, forcing the industries that use these raw materials to pass on the burden to the consumer. According to details, Aluminum HD-2 prices went up to Rs 350/kg in March this year from Rs 233/kg back in April 2020, showing almost 50 per cent increase. The global prices of Aluminum HD-2 also witnessed an increase of 42.25 per cent, from $ 1526/T in Apr 2020 to $ 2171/T in Mar 2021, but it was much lower than the increase in the local market.Read More...

National Electric Power Regulator Authority (NEPRA) has reserved judgment on the petition of Discos for the transfer of around Rs 96.50 billion to power consumers on account of monthly and quarterly adjustments. Presided over by NEPRA Chairman, Tauseef H. Farooqi, the regulator conducted separate hearings on the XWapda Discos demand for the transfer of burden of Rs 91.367 billion to power consumers on account of adjustments for the first two quarters (July- Sept 2020 and Oct-Dec 2020) of the current fiscal year and around Rs 5 billion under fuel price adjustment for February 2021 for XWapda Discos. If the demand is given approval, it will have an impact of Rs 0.91 per unit on the power consumers. In its petition submitted to NEPRA, XWapda Discos have demanded Rs 44.709 billion for the first quarter of 2020-21(July 2020 to September 2020) and Rs 46.658 billion for the second quarter of 2020-21(October 2020 to December 2020) under quarterly adjustments on account of variation in Power Purchase Price(PPP).Read More...

Pakistan Agriculture Storage and Service Corporation (PASSCO) has established 239 procurement centres across the country in order to initiate grain procurement drive for crop season 2021. These centres were established to facilitate the farmers in order to sell their produce on official fixed rates and save them from the exploitation of middle men, said Food Security Commissioner Dr imtiaz Ali Gopang. Talking to APP here on Tuesday, he informed that proposed target for PASSCO for wheat procurement drive 2021 has been set at 1.250 million tons. In this regard, PASSCO has already made all the necessary arrangements like requirements of logistics including supply of bardana (jute bags), gunji kits, fumigants or pesticides and, polyethylene, he added. Target of 1.250 million tons assigned to PASSCO for the wheat crop 2021 has further been sub-allocated to field zones and established different zones to further strengthening and streamlining the procurement campaign, Read More...