PSX Daily Market Review - 12th June 2017

Trading volume at PSX floor dropped by 60.22 million shares or 22.4%, DoD basis, whereas the KSE100 Index opened at 49950.34, posted a day high of 49961.00 and a day low of 49478.43 during the last trading session. The session suspended at 49526.92 with a net change of -431.41 points and a net trading volume of 39.35 million shares. Daily trading volume of KSE100 listed companies dropped by 25.44 million shares or 39.27%, DoD basis.
Foreign Investors remained in a net buying position of 5.04 million shares and the net value of Foreign Inflow increased by 7.55 million shares. Categorically, Foreign Individual, Corporate and Overseas Pakistani investors remained in net buying positions of 0.05, 3.67 and 1.32 million shares, respectively. While on the other side, Local Individuals and Brokers remained in net selling positions of 7.47 and 5.31 million shares but Local Companies, Banks and Mutual Funds remain in net buying positions of 2.66, 0.68 and 2.25 million shares, respectively.

Asian stocks edged lower early on Monday following a slide by U.S. technology shares and the dollar rose ahead of this week U.S. Federal Reserve policy meeting, with markets hoping for more guidance on the central bank interest rate path. The Fed holds a two-day meeting ending on Wednesday at which it is widely expected to hike interest rates. The focus is on whether the Fed thinks the U.S. economy is robust enough to withstand further rate increases through 2017. A rate hike accompanied by a message suggesting that the Fed may raise rates more than expected in 2017 would support the dollar but be negative for equity markets. MSCI broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was down 0.1 percent following a mixed day Friday on Wall Street where the Nasdaq .IXIC slid 1.8 percent on tumbling technology shares but the Dow .DJI closed at yet another record high. MSCI Asia-Pacific index was still in reach of a two-year high scaled late last week. Japanese Nikkei .N225 was down 0.5 percent and South Korean KOSPI slid 0.5 percent. Australian markets were closed for a public holiday.
Foreign exchange reserves have continued to deplete by a monthly average of $500 million for the past seven months, raising fears among currency dealers that the dollar could spiral out of control in the inter-bank market. Despite rising import bill, the exchange rate has been stable in the inter-bank market for more than a year thanks to intervention by the State Bank of Pakistan (SBP) to contain the rise of dollar. However, currency dealers believe the exchange rate could burst through the SBP-enforced ceiling if the reserves kept falling. According to the latest SBP report, forex reserves of Pakistan fell by $3.51 billion since October to $20.52bn on June 2. State Bank reserves dropped by $3.22bn to $15.7bn during the same period.
The joint investigation team (JIT) investigating the Panamagate case has issued a summons to Prime Minister Nawaz Sharif to appear before the team on June 15, officials in the government told DawnNews on Sunday on the condition of anonymity. Sources within the government said that the summons was issued to the PM on Saturday after he returned from his international trip to Kazakhstan, where he had been attending the Shanghai Cooperation Organisation (SCO) summit.
As per the latest numbers released by All Pakistan Cement Manufacturers Association (APCMA), the cement sales have recorded a jump of 6 percent annually to 37.58 million tons in first 11 months of current fiscal year. Data says that cement demand in local market remained strong during 11MFY17, where total local sales recorded a jump of 11 percent to 33.27 million tons. Fast pace of public and private infrastructure development projects along with government’s continued commitment towards CPEC related projects played its due role in generating cement demand. Federal PSDP utilisation stood at 95 percent of the revised budget (Rs715b compared to previously allocated Rs800b) as of May 26, 2017 and likely to jump 20 percent in FY17. Local utilisation levels have averaged to 79 percent in 11MFY17 compared to 72 percent in the same period last year. In May 2017 alone, local sales grew by 2.4 percent/11 percent MoM/YoY to 3.4 million tons. It is expected that demand in last month of FY17 to remain slow owing to the Holy month of Ramzan and upcoming Eid Holidays. However, uptick in construction activity is anticipated from mid July 2017.
Finance Minister Ishaq Dar has said that budget proposals of the senators are being decided on merit and practicability. The minister made these remarks while chairing a meeting at the Ministry of Finance to review various proposals received from parliamentarians related to the budget for FY2017-18. PM’s Special Assistant on Revenue Haroon Akhtar Khan, finance secretary, EAD secretary and senior officials of the Ministry of Finance and FBR attended the meeting. The Senate has made 275 recommendations to the National Assembly with major amendments in the Finance Bill 2017 including increasing the salaries and pension of government employees by at least 20 percent. However, the Senate’s recommendations are not binding on the National Assembly in case of Money Bill.