PSX Daily Market Review - 20th April 2017

The Bench Mark KSE100 Index opened at 46250.97 with a negative gap of 623.40 points, posted a day high of 47715.65 and a day low of 46048.07  during last trading session, whereas session suspended at 47603.48  with a net change of 729.11 points and net trading volume of 140.92 million shares, daily trading volume of KSE100 listed companies increased by 58.3 million shares or 70.56% , DoD basis.
Foreign Investors remained in net selling position of 15.1 million shares and net value of Foreign Inflow dropped by 13.6 million US Dollars. Categorically Foreign Individuals remained in net buying position of 9000 shares but Foreign Corporate and Overseas Pakistani investors remained in net selling position of 12.34 and 2.77 million shares respectively. On the other side Local Individuals and NFBCs remained in net selling position of 18.12 and 1.06 million shares but Local Companies, Banks, Mutual Funds and Brokers remained in net buying position of 5.74, 12.12, 12.16 and 5.36 million shares respectively.

Asian stocks may slip for a second consecutive day on Thursday as a weak Wall Street and declining commodity prices, especially for oil, prompted investors to trim their exposure to risky assets. With the outcome of the French presidential elections due at the weekend, markets are set to trade in well worn trading ranges, barring any major data surprises in Asia. MSCI broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slipped 0.5 percent in early trades after declining nearly 1 percent on Wednesday. "Markets may continue to trade on a cautious tone with the French elections coming up this weekend," ANZ strategists wrote in a daily note. Centrist Emmanuel Macron clung on to his status as favorite to win French presidential election in a four-way race that is too close to call, as the camp of far-right challenger Marine Le Pen ramped up its eurosceptic rhetoric in a row with Brussels.
The current account deficit for the first nine months of 2016-17 rose to $6.13 billion, which is 2.6 times higher than the deficit recorded a year ago. The deficit in July-March is double the negative current account balance recorded in 2015-16, the State Bank of Pakistan (SBP) reported on Wednesday. Experts say the large current account deficit was expected. Pressure is mounting on the external front due to a number of factors that are slowing down the inflows of dollars. The current account deficit was $2.35bn in July-March of the preceding fiscal year, SBP data shows. In 2015-16, the deficit was $3.39bn.
Prime Minister Nawaz Sharif has reportedly convened another meeting of the Cabinet Committee on Energy (CCOE) on Friday to follow up on his orders for the reduction in load shedding as temperatures in major cities slightly came down on Wednesday. The Friday meeting of the CCOE will be the third huddle in a fortnight on increasing energy shortfalls and unscheduled load shedding that have embarrassed the PML-N government at a crucial phase of its term.
The Pakistan Automotive Manufacturers Association (PAMA) has requested the government to abolish custom duty, additional custom duty, and reduce the rate of input tax on tractors. While submitting Budget Proposals 2017-18 for the tractor industry, PAMA stated that due to these issues the entire industry was facing liquidity crunch, affecting the trust of foreign investors/shareholders. The Engineering Development Board (EDB) had earlier allowed import of those components for manufacturing of agricultural tractors which had not been developed in Pakistan at zero percent custom duty. “However, during the year 2015-16, additional custom duty of 1% on import of such components was imposed by the government through mini budget. Further, 1% custom duty was imposed through budget for the year 2016-17, accumulating to a total of 2% customs duty,” stated PAMA.
A strong, globally available and highly flexible banking system is imperative to promote exports. Developing countries should specifically concentrate on exports to achieve their ultimate objectives of economic growth. Muhammad Naeem, vice chairman of the Pakistan Textile Exporters Association (PTEA), said this while addressing participants of the 44th International Commercial Banking Course who visited the PTEA here on Wednesday. The course was organised by the National Institute of Banking and Finance (NIBAF). Highlighting the importance of textile industry in country economy, he said that textile industry with 8.5 percent share in GDP was considered the backbone of the economy. Cotton based textiles contribute over 60% to the total exports, account for 46% of the total manufacturing and provide employment to 38% manufacturing labour force. Elaborating the history, he said that by mid-sixties there were about 180 units of textiles bleaching, printing and processing, mostly situated in Karachi and Punjab.

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

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