PSX Daily Market Review - 16th Feb. 2018

Trading volume at PSX floor increased by 12.5 million shares or 6.04% on DoD basis during last trading session, whereas the benchmark KSE100 Index opened at 43377.08, posted a day high of 43451.31 and a day low of 42859.85 during last trading session. The session suspended at 42942.35 with net change of -410.69 and net trading volume of 83.85 million shares. Daily trading volume of KSE100 listed companies increased by 6.01 million shares or 7.72% on DoD basis.
Foreign Investors remained in net buying position of 4.61 million shares and net value of Foreign Inflow increased by 1.63 million US Dollars. Categorically, Foreign Individual and Overseas Pakistani investors remained in net selling positioin of 0.21 and 0.34 million shares but Foreign Corporate Investors remained in net buying position of 5.16 million shares. While on the other side Local Individuals, NBFCs and Mutual Funds remained in net selling positions of 17.32, 4.87 and 1.12 million shares but Local Companies, Banks, Brokers and Insurance Companies remained in net buying of 18.64, 5.62, 1.5 and 1.84 million shares respectively.

Asian shares extended their recovery from two-month lows into a fifth day on Friday as the Wall Street market volatility gauge fell, while the U.S. dollar was undermined by various worries including rising inflation. U.S. debt yields stood near multi-year highs. Two-year note yields hit a 9 1/2-year high as bond prices fell on Federal Reserve officials’ signaling that recent volatility in U.S. stocks would not stop them raising interest rates in March. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.5 percent, though many Asian markets will be closed on Friday for the Lunar New year. Japan’s Nikkei rose 0.5 percent. Measured by the MSCI’s broadest gauge of the world’s stocks covering 47 markets, global shares have reclaimed more than half of the 10.7 percent losses incurred in their slump from a record intraday high on Jan 29 to their four-month intraday low hit a week ago.
Foreign direct investment (FDI) during the first seven months of the this fiscal year dropped 3 per cent on a year-on-year basis. The State Bank of Pakistan (SBP) reported on Thursday that the country received a total FDI of $1,488 million during July-January period of 2017-18. The FDI fell despite a healthy economic growth as reported by the Ministry of Finance and the central bank. The SBP expects a 5.8pc growth rate in FY18, indicating that domestic investment has increased substantially to achieve about 6pc economic growth target. The Chinese investments totalled $1,003.3m constituting 67.4pc of the total FDI the country received during the period under review suggesting that investments from other countries had been declining.
The Senate Standing Committee on Energy approved the Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Bill 2017 on Thursday. Known as the Nepra Amendment, the bill proposes the establishment of a Technical Appellate Tribunal against the decisions of the National Electric Power Regulatory Authority (Nepra). Under the current law, Nepra decisions can only be challenged before a high court.
The National Electric Power Regulatory Authority (Nepra) on Thursday penalised the National Transmission and Despatch Company – a state-owned entity – for delaying by up to six years a critical transmission project required to evacuate more than 1,500 megawatts of electricity despite acute shortages. Oddly, former prime minister Nawaz Sharif had inaugurated some of these power plants years ago but their full generation capacity could not be utilised by now despite continuous payment of capacity charges to private investors. More strangely, the power regulator imposed a notional fine of Rs10 million on the NTDC for project delays estimated to have caused tens of billions of rupees worth of losses to the exchequer and the consumers.
Punjab government initiated mega projects for the development and prosperity of the people and new record was set up by making saving of Rs682 billion in 12 mega development projects by better management and this saving is being used in other public welfare schemes. In only three projects - Chiniot Iron Ore project, Energy and Orang Line Metro Train - Punjab government saved Rs587 billion. One has to agree that due to integrity, transparency and efficiency this huge saving was possible. Likewise, land worth of Rs62 billion was retrieved from illegal occupants, Rs11 billion was saved from Lahore Waste Management Company and whereas Rs6.8 billion from Lahore Ring Road (Southern Loop 1& 2), Rs4.6 billion from Metro Bus Network (Lahore, Rawalpindi & Multan), Rs3 billion from Punjab Safe City Project, Rs3.1 billion from Pakistan Kidney & Liver Institute (PKLI), Rs2.8 billion from Self Employment Scheme, Rs1.0 billion from procurement of quality medicine and Rs1.0 billion from installing of solar systems at schools were saved.
Its recommended to practice caution as market is expected to remain volatile.

The Benchmark KSE100 Index have formatted a bearish trend channel on daily chart after penetrating a descending trend line on daily chart and right now supportive trend line of said channel is standing ahead to support index for a shorter term at 42553 while at 42130 points there is another supportive region created by a horizontal support which would also try to support index against current bearish rally but it not recommended to initiate new buying for short or mid term until index start a reversal because sliding below 42500 and 42100 would push index towards 40500 points. Its recommended to stay cautious until index close above 43470 points. As of right now index have resistances around 43375, 43474 and 43860 points. As today is last trading session of the week therefore today's closing means a lot on technical basis, closing below 43800 and 43500 would add further pressure on index.