PSX Daily Market Review - 19th June 2017

Trading volume at the PSX floor dropped by 225.45 million shares or 63.45%, DoD basis. Whereas, the KSE100 Index opened at 47461.36, posted a day high of 47527.41 and a day low of 46733.70 during the last trading session. The session suspended at 46858.56 with a net change of -584.17 points and a net trading volume of 58.27 million shares. Daily trading volume of KSE100 listed companies dropped by 49.1 million shares or 45.73%, DoD basis.
Foreign Investors remained in a net selling position of 9.46 million shares and the net value of Foreign inflow dropped by 9.99 million US Dollars. Categorically, Foreign Corporate investors remained in a net selling  position of 10.67 million shares but Overseas Pakistanis remained in a net buying position of 1.21 million shares. While on the other side, Local Individuals, Companies and Mutual Funds remained in net selling positions of 12.81, 10.45 and 1.67 million shares, respectively. Local Banks, NBFCs and Brokers remained in net buying positions of 4.44, 5.35 and 31.31 million shares, respectively.

Asian stocks rose on Monday, shaking off Wall Street uninspiring performance on Friday, while sterling was mostly steady after a van rammed into pedestrians in London even as markets braced for the start of Brexit talks. MSCI broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.5 percent. Japanese Nikkei .N225 added 0.6 percent. Australian shares climbed 0.5 percent and South Korean KOSPI .KS11 jumped 0.6 percent. Chinese shares .CSI300 advanced 0.55 percent after data showed home prices rose 10.4 percent in May from a year ago, although slowing from April 10.7 percent gain. Hang Seng .HSI gained 0.85 percent. MSCI Pakistan Standard (Large and Middle Capp) droppped by 1.37% while MSCI Pakistan IMI Index (Small, Middle and Large Cap) dropped by 1.33% on DoD basis during last trading session.
The top official from the United Nations Development Programme (UNDP) in the Asia-Pacific region has said that low tax-to-GDP ratio is critical for development in Pakistan and the government should look into the taxation issue, which is complicated as well as sensitive. UN Assistant Secretary-General and Regional Director of UNDP for Asia and the Pacific Haoliang Xu upon the conclusion of his four-day visit to Pakistan said, “if Pakistan does not have enough resources needed for investment in education, health, infrastructure and social protection then the Pakistani population cannot expect the government -- both federal and provincial -- can deliver on their expectations.”
With oil prices dropping below $45, losing all the gains from the Organisation of the Petroleum Countries (Opec) output cut, crude markets are in for some real, fundamental, trouble. Since May 25, when the Opec opted to roll over a 1.8 million barrel per day output cut for another nine months, crude prices have fallen about 12 per cent. Inventories are reportedly near record highs in many parts of the world. The US oil output is on increase. The Libyan and Nigerian output is on up and is seen by many as undermining the efforts led by Saudi Arabia. Adherence to the stated cut is under scrutiny as Opec output rose by 336,000 bpd in May to 32.14m bpd.
Pakistani exports to Afghanistan fell by a significant 27 per cent over the past one year, thanks to growing mistrust between the two countries as well as downgrade of Nato presence in the war-ravaged nation. According to officials on Friday, the worsening law and order situation in Afghanistan over the past months was another factor that contributed to the decrease in exports.
The government has released over Rs2,829 million for the Ministry of Petroleum and Natural Resources under the Public Sector Development Programme (PSDP) till date against the total allocation of Rs4,251 million for the fiscal year 2016-17. According to official data, Rs415.8 million have been released for acquisition of four drilling rigs with accessories for the Geological Survey of Pakistan. While, funds amounting to Rs131.6 million have been provided for appraisal of newly discovered coal resources of Badin Coal Field and its adjoining areas of Southern Sindh. Moreover, Rs20 million have been released to explore and evaluate metallic minerals in Bela and Uthal areas, district Lasbella of Balochistan.

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

The Benchmark KSE100 Index penetrated its bullish trend channel in bearish direction while expanding its previous correction and is caged in a descending triangle on daily chart. Breakout on either side of this triangle will push index for a new trend. As of now, the supportive regions are at around 48550 and 46257 and these levels could try to push index upward as they fall on 61.8% expansion level and a horizontal supportive region. If the index closes below these level then the next targets would be 45200 and 44500 at 100% expansion levels of its latest bearish corrections. Trading with strict stop loss of 46257 is recommended and after breakout of 46257 selling on strength would be preferred.