PSX Daily Market Review - 25th April 2019

Trading volume at PSX floor dropped by 3.62 million shares or 3.02% on DoD basis, whereas the benchmark KSE100 index opened at 36,375.22, posted a day high of 36,733.05 and a day low of 36,332.28 points during last trading session while session suspended at 36,504.25 with net change of 100.22 points and net trading volume of 93.22 million shares. Daily trading volume of KSE100 listed companies dropped by 2.19 million shares or 2.30% on DoD basis.
Foreign Investors remained in net buying positions of 1.42 million shares and net value of Foreign Inflow increased by 3.21 million US Dollars. Categorically, Foreign Corporate remained in net buying positions of 5.69 million shares but and Overseas Pakistani investors remained in net selling positions of 4.27 million shares respectively. While on the other side Local Companies, Banks, NBFCs, Mutual Fund and Insurance Companies remained in net buying positions of 1.34, 3.28, 0.21, 1.32 and 1.92 million shares respectively but Local Individuals and Brokers remained in net selling positions of 8.81 and 0.10 million shares respectively.

Asian shares dip; euro weighed by sagging German business morale
Asian shares slipped on Thursday as a surprise deterioration in German business morale rekindled fears of slowing global growth, while oil prices pulled back slightly after a sharp run-up earlier in the week. The euro slumped to a 22-month low against the U.S. dollar overnight after the drop in German business confidence highlighted the divergence between data in the euro zone and the United States. MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.2 percent, while Japan’s Nikkei average edged up 0.3 percent to 22,264.81 points. Overnight, Wall Street shrugged off some earnings misses but drifted lower at the end of the session, after the S&P 500 and the Nasdaq Composite registered record closing highs on Tuesday. Chotaro Morita, chief rates strategist at SMBC Nikko, noted hopes that the Chinese economy is bottoming out have contributed to recent rallies in global equities.
IMF folds package with more stringent conditions
The IMF has folded its bailout package with more stringent conditions as Islamabad have been conveyed to ensure guarantee from China that it will get rollover of $5 to $7 billion debt on account of deposits and commercial loans in order to meet its financing requirements during the programme period. The IMF has put the condition to bridge financing gap through “unidentified” avenues as Islamabad got deposits from China, Saudi Arabia and the UAE in the range of $7 billion so far in the ongoing financial year. The commercial lending from Chinese banks alone amounted to $5 to $5.5 billion.
Pakistan, Korea sign $500m framework arrangement
Pakistan and Republic of Korea signed a framework arrangement amounting to $500 million on Wednesday. Secretary, Economic Affairs Division, Noor Ahmed and Ambassador of the Republic of Korea, Kwak Sung-Kyu signed the framework arrangement on behalf of their respective governments. Under the signed framework arrangement (2018-20), Republic of Korea will provide long term concessional financing up to $500 million for execution of various development projects in health, information technology, communication, agriculture, and energy etc.
Nepra rejects govt petition for increase in power tariff
Rejecting the government petition for increase of 16 paisas per unit, National Electric Power Regulatory Authority (NEPRA) on Wednesday allowed tariff decrease of Rs 0.4 per unit for ex-WAPDA distribution companies on account of fuel price adjustment for the month of March. The decision was taken by NEPRA in a public hearing on the petition filed by the Central Power Purchasing Agency (CPPA). The decision will have a cumulative impact of around Rs 280 million on the electricity consumers and the relief will be provided to the consumers in the next month’s bills. The Central Power Purchasing Agency (CPPA-G) on behalf of DISCOs presented the case before the NEPRA. In its petition the CPPA said it had charged consumers a reference tariff of Rs 4.9990 per unit in March while the actual fuel cost turned out more than the charged amount i.e. 5.16 per unit and hence it asked the regulator that it should be allowed to transfer the increase of Re 0.1581 per unit to the power consumers. However NEPRA has rejected the demand for increase and instead decreased the tariff by 4 paisa per unit.
Islamabad ready to fight its case before FATF, NA body told
Pakistan will fight its case before the Financial Action Task Force (FATF) on May 15 in Colombo, Sri Lanka, besides undertaking diplomatic efforts for performance-based review of its “robust” compliance with global standards against money laundering and terror financing. This was the crux of an in-camera briefing to the Standing Committee of the National Assembly on Finance and Revenue. Finance Secretary Muhammad Younus Dagha, the Federal Board of Revenue (FBR) chairman, executive officers of the State Bank of Pakistan, Commissioner of the Securities and Exchange Commission of Pakistan (SECP) and representatives of foreign affairs and National Counter Terrorism Authority (Nacta) updated the committee on FATF compliance. Pakistan has so far complied with 19 out of 28-29 FATF indicators and made progress on five indicators relating to legislative and administrative actions, the committee was told, according to informed sources. The sources also said the government was hoping to comply with remaining actions by June this year, some of them through the finance bill 2019-20.

ASL, DGKC, PPL, DOL and PAEL would try to resist against negative momentum on intraday basis and a positive sentiment could be witnessed in these scripts, while EFOODS, FFL, SNPG and ATRL would remain in laggards.

The Benchmark KSE100 Index have generated a hammer on daily chart during last trading session and it's expected now that it would try to start a reversal from current trading session after a steep dip on intraday basis. Daily momentum indicators are in mixed mode while hourly momentum indicators have change their direction towards bearish side. It's expected that index would try to take a dip initially during current trading session and then a pullback would be witnessed which may result in occurrence of a morning shooting star on daily chart. Index would try to support at 36,100 and 35,800 points while on flipside it may face resistances at 36,760 and 37,000 points. It's recommended to stay cautious and start buying on dip with strict stop loss of 35,800 points from current trading session and then hold for a short term basis.