PSX Daily Market Review - 5th June 2017

Trading volume at PSX floor dropped by 182.17 million shares or 45.1%, DoD basis. Whereas, the KSE100 index opened at 48543.62 with a negative gap of 237.19 points, posted a day high of 48915.64 and a day low of 47491.65 during the last trading session. The session suspended at 48555.30 with a net change of -225.51 points and a net trading volume of 105.05 million shares. Daily trading volume of KSE100 listed companies dropped by 92.03 million shares or 46.7%, DoD basis.
Foreign Investors remained in a net selling position of 6.8 million shares and the net value of Foreign Inflow dropped by 23.44 million US Dollars. Categorically, Foreign Corporate investors remained in a net selling position of 7.94 million shares but Overseas Pakistanis remained in a net buying position of 1.14 million shares. While on the other side, Local Individuals and Brokers remained in net selling positions of 71.55 and 10.55 million shares, but Local Companies, Banks and Mutual Funds remain in net buying positions of 81.76, 5.53 and 0.35 million shares, respectively.

The dollar languished near a seven-month low on Monday after U.S. jobs growth in May missed expectations while attacks in London that left at least seven people dead and 48 injured just days before Thursday national election dented sterling. The geopolitical risks weighed on Asian stocks, which pulled back on Monday despite a rise by U.S. stocks to record highs on Friday. The dollar index, which tracks the greenback against a basket of six major peers, hit its lowest level since the November election on Monday. It was last trading flat at 96.716, failing to erase any of Friday 0.5 percent loss. Japanese Nikkei .N225 retreated 0.1 percent on a stronger yen. Australian shares slid 0.8 percent and South Korean KOSPI .KS11 was off 0.1 percent. On Friday, all three major Wall Street indexes .DJI .SPX .IXIC hit all-time highs, with gains in technology and industrial stocks more than offsetting the subdued jobs report.
Uptake of cement in domestic market accelerated to 10.90 percent in May 2017 while exports continue to mar the performance of the cement sector registering a decline of 44.58 percent in May 2017, the fourth massive decline in exports which declined by 45.69 percent in February, 60.39 percent in March and 50.75 percent in April. This dismal export performance has over shadowed the excellent uptake of cement in the domestic market. According to the data released by the All Pakistan Cement Manufacturers Association, cement despatches to domestic markets during May 2017 were 3.399 million tons compared to 3.065 million tons during same month last year showing a healthy increase of 10.90 % and indicating continuity of the growth momentum. Exports during May 2017 were 0.309 million tons against 0.558 million tons during May, 2016 showing a reduction of 44.58 percent. Total despatches during May, 2017 were 3.708 million tons compared to 3.623 million tons during same month last year showing an increase of 2.36 percent.
The Securities and Exchange Commission of Pakistan (SECP) has shared its report with the International Organization of Securities Commissions (IOSCO) on implementation of 2015. IOSCO review recommendations for assessment under its committed follow up review starting June 2017. The Report is an outcome of extensive work of SECP with IOSCO to benchmark Pakistani capital markets with international regulatory standards and focuses on the challenge of strengthening securities market resilience.
Pakistan is producing 3.5 million tons (MT) coal and importing 4 to 5 MT coal every year to meet needs of different sectors like steel, cement and power generation, official sources in the Ministry of Petroleum and Natural Resources said. "The coal is imported mainly from Afghanistan, Australia, Canada, Indonesia, South Africa and the US and consumed in steel and cement manufacturing and power generation units," they told APP. Commenting on domestic production, they said so far nineteen coalfields have been discovered in the country. The recent geological investigations have shown that around 186 billion tons of coal reserves existed in different parts of the country, which could be used as a primary and inexpensive source for power generation, they added.
National Transmission and Despatch Company (NTDC) has added only 87Km 500kV and 220kV transmission lines against the target addition of 779km during fiscal 2016-17. The total target for adding 500kV lines during 2016-17 was 382 Km; however, NTDC added only 9 Km, while for 220kV lines the target was 347Km but again only 78Km new addition was made, according to the Annual Plan 2017-18. The Annual Plan 2017-18 forecasted that, as per the data of National Power Control Centre (NPCC), on average there will be only 13MW demand and supply gap by June 2018. “It will almost equate the supply demand with marginal shortfall of 13MW only by June 2018,” the Annual plan said. As of June 30, 2018, the total installed capacity will reach to 33546MW where the average demand will be 18623MW and the average generation will be 18610MW, the annual plan predicted. On average, there will be only 13MW gap between electricity generation and demand, said the plan.
The Ministry of Water and Power has formed special vigilance teams at Pepco level to conduct surprise visit of different areas in all the distribution companies to ensure enforcement of announced power load management plan. The special vigilance teams of the Ministry of Water and Power have visited five distribution companies and many grid stations were found to have higher number of load management duration than the announced schedule upon which six SDOs were suspended, said the spokesman for the Ministry of Water and Power here on Sunday.

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