PSX Daily Market Review - 19th Sep 2019

Trading volume at PSX floor dropped by 22.65 million shares or 18.56% on DoD basis, whereas the benchmark KSE100 index opened at 31,887.42, posted a day high of 31,908.92 and a day low of 31,508.75 points during last trading session while session suspended at 31,555.47 points with net change of -353.45 points and net trading volume of 74.67 million shares. Daily trading volume of KSE100 listed companies dropped by 29.93 million shares or 28.61% on DoD basis.
Foreign Investors remained in net selling positions of 3.38 million shares and net value of Foreign Inflow dropped by 0.74 million US Dollars. Categorically, Foreign Individual and Overseas Pakistani Investors remained in buying positions of 0.008 and 0.98 million shares but Foreign Corporate Investors remained in selling positions of 4.38 million shares respectively. While on the other side Local individuals and banks remained in net long positions of 11.92 and 1.51 million shares but Local Companies, NBFCs, Mutual Funds, Brokers and Insurance Companies remained in net selling positions of 3.18, 0.008, 4.25, 0.17 and 2.40 million shares respectively.

Asian shares edge higher after Fed, investors await BOJ
Asian shares edged higher on Thursday, tracking some modest Wall Street gains after the U.S. Federal Reserve cut interest rates as expected but offered mixed signals on the next easing, keeping investors cautious. The Treasury yield curve flattened as Fed Chairman Jerome Powell dashed hopes he would signal further easing while division among central bankers has increased uncertainty over how much further rates might fall. MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.03%. Japan’s Nikkei rose 0.46%, while Australian shares rose 0.23%. The yen traded near a seven-week low versus the dollar before a Bank of Japan meeting later on Thursday where policymakers are expected to keep their ultra-easy policy unchanged.Central banks around the world have been loosening policy to counter the risks of low inflation and recession. Easier monetary policy has generally supported equities. However, some analysts argue that a bond market rally has gone too far, saying yields have fallen too fast and curves flattened too much. Others are worried about the growing amount of sovereign debt with negative yields.
ExxonMobil, UGDC ink historic LNG supply deal
ExxonMobil and Pakistani energy company Universal Gas Distribution Company (UGDC) has signed LNG supply deal and the first Cargo of the imported gas by a private company will be arriving next month. Under the agreement signed between both the companies a total of four cargos will be imported in one year, UGDC CEO Ghiyas Paracha told The Nation.
Govt includes three more PSEs in active list of privatisation programme
The government has decided to include three more public sector entities (PSEs) including State Life Insurance Corporation (SLIC) as well as Islamabad Electric Supply Company (IESCO) and part of Lahore Electric Supply Company (Lesco) in Active List of Privatisation Programme. Adviser to the Prime Minister on Finance and Revenue Dr Abdul Hafeez Shaikh chaired a meeting of the Cabinet Committee on Privatisation (CCoP) to discuss five agenda items related to the ongoing privatisation programme of the government. The meeting approved inclusion of State Life Insurance Corporation (SLIC) as well as Islamabad Electric Supply Company (IESCO) and part of Lahore Electric Supply Company (Lesco) in Active List of Privatisation Programme. The previous PML-N government had also started the sell-off process of power distribution companies (Discos) but shelved it after the employees including labour unions came on the streets.
ECC decides to continue ban on export of wheat, flour
The Economic Coordination Committee (ECC) of the Cabinet has decided to propose provincial governments to undertake a fresh stock-taking of wheat in godowns to ensure adequate supplies in the winter season. The ECC has thoroughly discussed the wheat situation in the country and decided to continue ban on export of wheat flour in the light of a briefing by the Ministry of National Food Security and Research. It instructed the Ministry of Finance to call an early meeting of the National Price Monitoring Committee to assess the wheat and flour supply situation in different parts of the country, including the federal capital in view of recent reports of rising prices of some core food items, including flour.
Cotton production falls by 26pc
The country’s cotton output faces a shortfall of 0.664 million bales or 26.41 per cent compared to same period last year, according to official figures released on Wednesday. The production shortfall, recorded at the initial period of the season (2019-20) up to Sept 15, is unlikely to be fulfilled during the remaining period, observed cotton analyst Naseem Usman. “It is an alarming situation which will directly impact country’s GDP and also put pressure on country’s foreign exchange reserves because huge quantity of around 3-4m cotton bales will have to be imported to meet the shortfall,” he added. Further, Pakistan Cotton Ginners’ Association (PCGA) Chairman Mian Mahmood Ahmed said the promised incentives to cotton growers for achieving higher cotton production target were never released by the government.

The Benchmark KSE100 index have created an evening shooting start on daily chart after getting resistance from a horizontal resistant region during last trading session and it's expected that index would try to open with a negative gap below 31,500 points during current trading session and would try to continue its bearish momentum towards 31,200 and 31,063 if it would succeed in closing below 31,460 points on hourly chart. Daily stochastic and MAORSI are ready for a bearish crossover on daily chart and if these would succeed in doing so then a strong bearish sentiment would be witnessed in coming days. But chances of occurrence of a cheat pattern are still intact and if index would not succeed in closing below 31,200 points then a cheat pattern would try to push index upward. Therefore it's recommended to stay cautious during current trading session.

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