PSX Daily Market Review - 29th April 2019

Trading volume at PSX floor increased by 37.12 million shares or 34.76% on DoD basis, whereas the benchmark KSE100 index opened at 36,806.86, posted a day high of 37,158.35 and a day low of 36,787.44 points during last trading session while session suspended at 37,130.63 with net change of 334.60 points and net trading volume of 109.32 million shares. Daily trading volume of KSE100 listed companies increased by 25.07 million shares or 29.76% on DoD basis.
Foreign Investors remained in net selling positions of 0.01 million shares and net value of Foreign Inflow dropped by 0.92 million US Dollars. Categorically, Foreign Corporate remained in net buying positions of 3.40 million shares but and Foreign Individuals and Overseas Pakistani investors remained in net selling positions of 0.03 and 3.38 million shares respectively. While on the other side Local Individuals, Local Companies, Banks and Insurance Companies remained in net selling positions of 0.45, 0.56, 2.86 and 0.82million shares respectively but NBFCs, Mutual Fund and Brokers remained in net buying positions of 2.50, 0.52 and 0.85 million shares respectively.

Asian shares rise on strong U.S. GDP, eyes on Fed, China
Asian stock markets edged up on Monday after surprising strong U.S. first-quarter economic growth boosted the S&P 500 index to a record high, but gains were capped by caution over less upbeat aspects in the GDP report which pointed to some weakening ahead. Investors were also awaiting a meeting of the U.S. Federal Reserve this week and Chinese factory data for further clues on policy direction in the world’s biggest economies. MSCI’s broadest index of Asia-Pacific shares outside Japan was up less than 0.1 percent, edging higher after posting its biggest weekly drop in more than a month last week. Australian shares were down 0.26 percent, while Seoul’s KOSPI was up 0.4 percent. Japan’s financial markets are closed for a long national holiday this week, but Nikkei 225 futures in Singapore were 0.72 percent higher.
CAA reviewing agreements with foreign countries
Aviation Secretary Shahrukh Nusrat said on Saturday that the Civil Aviation Authority (CAA) was reviewing its air service agreements (ASAs) with foreign countries “to change the clauses which are not beneficial to domestic airlines”. He said this while speaking at a press conference here at the CAA headquarters. Domestic airlines, particularly the Pakistan International Air­lines, see the ASAs reached with the countries whose airlines were flying into Pakistan under the previous open sky policy as the main reason behind what they called ‘snatching’ of their share of passengers. As the federal cabinet has approved the National Aviation Policy, 2019 — also called the fair sky policy — the CAA is in the process of modifying existing bilateral ASAs. Mr Nusrat told reporters that the implementation on the new aviation policy was continuing at a fast pace and most of the rules and regulations concerned had been revised.
Privatisation of seven PSEs to be discussed with IMF
The government has firmed up a plan for privatisation and restructuring of major public sector entities (PSEs) as part of the proposed medium-term economic and financial policies. This will be part of discussions with the International Monetary Fund (IMF) this week for a three-year bailout package under which the provinces have agreed in principle on a single sales tax pro forma that will ultimately lead to a single value-added tax (VAT) regime. Informed sources said the government was not committing with the IMF divestment of any of the loss-making entities at this stage and these would be passed through a restructuring phase, but transactions of seven mostly profitable and efficient entities would be completed in the first year i.e. fiscal year 2019-20.
Huawei CEO expresses interest in 'heavy investment' during meeting with PM Imran in Beijing
Prime Minister Imran Khan on Sunday met the founder and chief executive of Chinese tech giant Huawei, Ren Zhengfei, in Beijing, who expressed his interest in making "heavy investment" in Pakistan, according to a statement by the Ministry of Planning. Huawei has already set up a regional service centre in Pakistan, the statement notes, adding that 600 IT professionals are presently working there. The prime minister also met with representatives of other leading Chinese firms, who pledged large-scale private sector investment in Pakistan. The CEOs of Rainbow Agritech Group, Challenge Apparel, Li & Fin Corporation, and Foton cars were among the business leaders who met the premier, according to the planning ministry handout.
Political reasons behind Asad’s ouster
A number of officials in the finance ministry and some top members of the ruling Pakistan Tehreek-i-Insaf (PTI) believe that reasons behind the removal of Asad Umar as finance minister were “political” rather than economic policies. Justifying this view, they said only a few days back the prime minister had praised Mr Umar for his efforts in lowering the scale of adjustments demanded by the International Monetary Fund (IMF) in the proposed bailout package. The sources said that Mr Umar, who was once considered a close confidant of the prime minister, had received the news of his removal with a “high surprise” as he was not expecting such a move days after his “successful” visit to Washington in connection with the negotiations with the IMF.

MLCF, FCCL, NML, NCL and BOP would try to lead the positive momentum, while ISL, SNGP, EPCL and ENGRO would remain in laggards.

The Benchmark KSE100 Index have succeeded in penetration above its major resistant region of 37,000 points and a have confirmed a daily morning star during last trading session, but now it's being capped by a resistant trend line which would try to resist against current bullish momentum. It's expected that index would try to open with a positive gap which may lead it towards 37,350 points where it would face a strong resistance and if it would not succeed in penetration above that region then a corrective move could be witnessed on intraday basis. Daily momentum indicators have generated bullish crossovers and these would try to lead index in positive direction but it's recommended to stay cautious with previous long positions and try to add in chunks on dip with strict stop loss. it's expected that index would find supports at 37,000 and 36,760 points while on flipside it would face resistances at 37,350 and 37,700 points. Daily closing above 37,700 points would clear its way towards 39,000 and 39,700 points.