PSX Daily Market Review - 21st Feb. 2018

Trading volume at PSX floor increased by 43 million shares or 33.93% on DoD basis during last trading session, whereas the benchmark KSE100 Index opened at 43587.98, posted a day high of 43588.77 and a day low of 42864.82 during last trading session. The session suspended at 43294.95 with net change of -277.72 and net trading volume of 68.89 million shares. Daily trading volume of KSE100 listed companies increased by 29.67 million shares or 75.63% on DoD basis.
Foreign Investors remained in net buying position of 5.81 million shares and net value of Foreign Inflow increased by 2.31 million US Dollars. Categorically, Foreign Corporate Investors remained in net buying position of 5.95 million shares but Overseas Pakistanis remained in net selling position of 0.22 million shares. While on the other side Local Individuals, Mutual Funds and Brokers remained in net selling positions of 0.76, 5.37 and 5.18 million shares respectively but Local Companies, Banks, NBFCs and Insurance Companies remained in net buying positions of 0.23, 0.08, 0.38 and 3.03 million shares respectively.

Stock markets dipped after a long winning run on Wall Street ended overnight, while the dollar gained momentum on Wednesday as yields on U.S. Treasury debt headed for highs not seen in four years. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS lost 0.15 percent. Japan's Nikkei .N225 shed 0.2 percent.Australian stocks were down 0.05 percent and South Korea's KOSPI .KS11 fell 0.4 percent. The Dow .DJI and S&P 500 .SPX fell on Tuesday to snap a six-session winning streak as a sharp decline in Walmart (WMT.N) weighed heavily. Gains in Amazon (AMZN.O) and chip stocks helped the Nasdaq .IXIC hold near the unchanged mark. U.S. equities pulled back sharply from record highs earlier this month as a steady rise in Treasury yields raised worries that the Federal Reserve could hike interest rates more frequently this year than initially expected.
The Generalised System of Preferences Plus (GSP+) scheme has passed smoothly through European Parliament’s Committee on International Trade (CIT), enabling Pakistani exporters to enjoy preferential duties on exports for the next two years. The continuation of the scheme is an award for Islamabad’s progress in enacting new laws and developing new institutions for implantation of 27 core conventions of GSP+, specially the National Action Plan for human rights. Speaking to Dawn on Tuesday, EU Ambassador Jean-François Cautain confirmed these developments.
The government on Tuesday assured the parliament that the management of Pakistan International Airlines (PIA) will remain with the government, while 49 per cent shares will be sold by April 15, as stipulated under the PIAC Conversion Act of 2016 approved by the parliament. This was stated by Privatisation Minister Daniyal Aziz both, to Senate Standing Committee on Privatisation and National Assembly, in response to a calling attention notice that had been moved by the PPP members. Briefing the members, the minister said the government intends to separate transport business from the airline’s assets and the entity would be owned by the state. In this transaction, the majority shares and management control will remain with the state, he said.
Pakistan’s fiscal deficit touched 2.2 per cent of gross domestic product (GDP) in the first half of this fiscal year despite reasonable cash surpluses offered by the four provinces. As part of the budget 2017-18, the government had set a target of containing fiscal deficit below 4.1pc but the actual deficit in first half of the year has already moved past 2.2pc (almost 54pc of the limit), revealed fiscal operations data of the Ministry of Finance. With this pace, the deficit seems unlikely to stay lower than 4.8pc at the end of the fiscal year. The ministry said the consolidated fiscal deficit amounted to Rs796.3 billion during July-December 2017 period or 2.2pc of GDP compared to Rs799bn of same period last year when half-year gap between expenditure and revenues stood at 2.5pc and ultimately reached 5.8pc at the end of full fiscal year.
Pakistan’s current account deficit widened by 48 per cent in the first seven months of the fiscal year, reflecting the mounting pressure of trade deficit which jumped by 24pc in the same period. The State Bank of Pakistan (SBP) reported on Tuesday that the current account deficit during July-Jan rose to $9.156 billion compared to $6.182bn deficit noted in the same period of 2016-17. In the month of January, the current account deficit increased to $1.617bn against $1.256bn in December. The January deficit was even higher than the monthly average deficit of $1.308bn. The trend suggests that the overall deficit could be around $15bn by the end of 2017-18 if the current trajectory persists.
PAEL, TRG, SNGP, PSO andPPL may lead the index in positive direction

The Benchmark KSE00 Index have bounced back after posting double bottom on daily chart indside its bearish trend channel but the session closed at edge of said channel with a heathier recover on intraday basis. As of right now index would try to head towards 43700 points on intraday basis where it would find resistance from a descending trend line and breakout of that trend line would call for 43910 again which is becoming stronger resistance with every passing day. Its recommended to initiate new buying on dip for current trading session with strict stop loss and book profits before 43700 and 43910 points. Hourly and daily trend is in bullish momentum which would lead towards a positive recovery.