PSX Daily Market Review - 31st Oct. 2017

Trading volume at PSX floor dropped by 34.42 million shares or 25.85%, DoD basis, whereas, the benchmark KSE100 Index opened at 41168.19, posted a day high of 41173.38 and a day low of 40258.58 during the last trading session. The session suspended at 40324.32 with a net change of -781.09 and net trading volume of 53.19 million shares. Daily trading volume of KSE100 listed companies dropped by 26.23 million shares or 33.02%, DoD basis.
Foreign Investors remained in a net selling position of 3.81 million shares and net value of Foreign Inflow dropped by 6.01 million US Dollars. Categorically, Foreign Individuals and Overseas Pakistanis remained in net buying positions of 0.24 and 0.53 million shares but Foreign Corporate Investors remained in a net selling position of 4.59 million shares. While on the other side Local Individuals, Banks and Insurance Companies remained in net buying positions of 5.74, 0.74 and 1.77 million shares but Local Companies, Mutual Funds and Brokers remained in net selling positions of 3.16, 1.68 and 2.13 million shares respectively.

Asian stocks were mostly sluggish on Tuesday after weakness on Wall Street, while the dollar sagged following news that investigators probing Russian interference in the 2016 U.S. election had charged President Donald Trump’s former campaign manager. Data showing a sharper-than-expected slowdown in China’s October factory growth also curbed regional investors’ appetite for riskier assets. Beijing’s war on winter air pollution is forcing many northern steel mills, smelters and factories to curtail production, adding to uncertainty amid early signs of a slowdown in the world’s second-largest economy. Shanghai shares .SSEC lost 0.3 percent and Hong Kong's Hang Seng .HSI retreated 0.35 percent. MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up 0.2 percent. Japan's Nikkei .N225 lost 0.3 percent, Australian shares were effectively flat and South Korea's KOSPI .KS11 added 0.3 percent.
Standard and Poor's (S&P) Global Ratings, a global rating agency, on Monday affirmed Pakistan 's 'B' long-term and short-term sovereign credit rating. “The outlook for the long-term ratings remains stable,” the S&P stated in its latest report. The stable outlook reflects the S&P expectations that Pakistan 's external and fiscal metrics will not worsen materially from their current levels. “We believe the country's economic prospects remain favourable ,” it stated. S&P further expected Pakistan 's GDP to grow at an average of 5.7 percent in the period 2017-2020. Meanwhile, the government of Pakistan welcomed the annual rating report by S&P as a manifestation of soundness of economic policies. “Affirmation of Pakistan 's better economic prospects , higher and inclusive GDP growth in coming years with stable economic outlook reflects on the economic management of the government of Pakistan” the Ministry of Finance spokesperson said.
China Power Hub Generation Company Pvt Ltd (CPHGC) — the sponsor of proposed 1,320MW coal power project — on Monday said it had finalised $1.5 billion financing arrangements with a consortium of Chinese banks led by China Development Bank (CDB) and Exim Bank of China. With this, the company said it was getter closer to have a financial close for the project by end of 2017, according to a company statement which said the financing documents including the main foreign loan facility agreement were signed last week in Chengdu, China. The consortium of banks will provide up to 75 per cent of total project investment that works out at approximately $1.5bn. It said the China Power International Holding Ltd (CPIH) had until now provided $300 million as shareholder loan to pay for project construction.
ExxonMobil has pulled out of a major project in Pakistan in a potential blow to plans to boost imports of liquefied natural gas (LNG) after years of winter shortages. Differences among the six-member group behind the project in Port Qasim in Karachi mean French oil major Total and Japan’s Mitsubishi may also quit and join a rival scheme, government officials and industry sources told Reuters. A senior Pakistani government official put the chances of success for the project, set to be Pakistan’s third and biggest by import capacity, at 10-20 per cent due to the disagreements.
Oil and Gas Regulatory Authority (Ogra) has recommended the government to increase price of high speed diesel (HSD) by 5.19 per litre and motor spirit (petrol) by Rs2.49 per litre for November 2017. According to a working paper moved to the Ministry of Energy (Petroleum Division) and the Ministry of Finance, OGRA has recommended an increase of up to 33.3 percent in the prices of different petroleum products, it was learnt reliably here. The Ogra also proposed an increase of Rs15.99 per litre in price of superior kerosene oil and Rs 12.63 per liter increase in light diesel oil (LDO). According to a working paper moved to the Petroleum Division and the Ministry of Finance, the Ogra has proposed to increase petrol rate by 3.4 percent or Rs 2.49 per litre and high speed diesel by 6.5 percent or Rs 5.19 per litre.

Today PAEL and TRG may lead the market in the positive direction.

The Benchmark KSE100 Index has a supportive region ahead at 40100 but breakout of that region might call for 39400, where it will face a strong support. Weekly Stochastic is in bullish mode which is a hope for bulls on longer run. Hourly Stochastic is trying to generate a bullish crossover which might try to push the index back in the positive zone on intraday basis. As Index is falling back after posting 61.8% of its last bullish rally therefore it needs to be cautious because if it may start the expansion of that correction then breakout of 39950 might call for 38640 for 100% expansion on its way to that expansion index has supportive region at 39400 from a horizontal supportive region. On its way back Index might get resistance from 40800. For the current trading session buying around 40000 with strict stop loss of 39900 could be initiated as if index slips below 39950 then it might target 39400.