PSX Daily Market Review - 19th July 2017

Foreign Investors remain in net selling of 6.34 million shares and net value of Foreign inflow dropped by 1.25 million shares. Categorically Foreign Corporate and Overseas Pakistani investors remain in net selling of 5.3 and 1.04 million shares respectively. While on the other side Local Individuals and Brokers remain in net selling of 7.02 and 2.42 million shares respectively. But Local Companies, Baks, NBFCs and Mutual Funds remain in net buying of 4.35, 0.18, 0.2 and 7.92 million shares respectively.

The dollar stayed on the defensive on Wednesday as investors wagered any further tightening in the United States would be slow at best, while optimism on Chinese economy underpinned Asian shares and commodities. The U.S. currency was near multi-month lows after the collapse of the Republicans push to overhaul healthcare dealt a blow to President Donald Trump ability to pass promised tax cuts and infrastructure spending. The diminished prospect of fiscal spending was a boon to bonds, especially as a run of soft U.S. inflation results had lessened the risk that the Federal Reserve would need to be aggressive in removing its stimulus.
The government on Tuesday allowed exports of 300,000 tonnes of sugar provided the industry maintains stable domestic prices. The decision was taken at a meeting of the Cabinet’s Economic Coordi­nation Committee (ECC) presided over by Finance Minister Ishaq Dar. The committee rejected a call for the export of 600,000 tonnes of sugar recommended by the ministries of commerce and industries. Instead it decided that sugar exports would be immediately stopped in case of abnormal increase in domestic prices. The exports would entail no rebate or subsidy, an official said.
The revenue collection recorded a growth of over 30 per cent in the first 15 days of 2017-18. The spurt is despite the entanglement of the Federal Board of Revenue (FBR) in the Panama Papers investigation. In addition, transfers of some of the board’s senior officers also took place recently. Tax officials have lately been busy with the JIT and Supreme Court proceedings instead of focusing on revenue policies. A similar trend exists in key ministries as the Panama Papers case has distracted senior government officers from their regular work.
Pakistan is taking measures to improve and upgrade customs procedures in line with international standards. During a meeting on Tuesday, Finance Minister Ishaq Dar informed World Customs Organisation (WCO) Secretary-General Kunio Mikuriya that steps were also being taken to facilitate and promote border trade. “Pakistan fully supports all measures for enhancing regional connectivity, cooperation and promotion of regional trade is a major area in this regard.”
The Senate Standing Committee on Finance on Tuesday was briefed by State Bank officials about current laws to counter money laundering, loan default and other financial crimes. The committee was informed that more than 200 cases — filed under the Anti-Money Laundering Law — have been forwarded by the Financial Monitoring Unit (FMU) of the government to the Federal Board of Revenue (FBR). Chairman of the committee Senator Saleem Mandviwalla enquired if the law was being used as a threatening tool by certain elements within the FBR.

The Market is expected to remain volatile today. We advise Traders to exercise caution. Buying on dips and booking gains on strength is recommended.