PSX Daily Market Review - 7th June 2018

Trading volume at PSX floor increased by 56.94 million shares or 34.20% on DoD basis during last trading session, whereas the benchmark KSE100 Index opened at 43,767.67, posted a day high of 44,169.19 and a day low of 43,683.09 during last trading session. The session suspended at 44,144.20 with net change of 441.62 and net trading volume of 158.93 million shares. Daily trading volume of KSE100 listed companies increased by 36.32 million shares or 29.63% on DoD basis.
Foreign Investors remained in net selling position of 10.49 million shares and net value of Foreign Inflow dropped by 7.65 million US Dollars. Categorically, Foreign Individuals remained in net buying positions of 0.02 million shares but Foreign Corporate and Overseas Pakistanis investors remained in net selling positions of 9.26 and 1.25 million shares. While on the other side Local Individuals, Local Companies, NBFCs, Mutual Fund and Insurance Companies remained in net buying positions of 6.98, 2.56, 2.02, 1.90 and 4.68 million shares but Banks and Brokers remained in net selling positions of 0.66 and 10.26 million shares respectively.

Strong fundamentals support Asian shares, Euro, yields up after ECB comments
Asian shares rose to 2 1/2-month high on Thursday, supported by strong economic fundamentals, while expectations the European Central Bank could start to wind down its stimulus boosted the euro and global bond yields. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS edged up 0.2 percent to extend its gains, hitting a 2-1/2 month high for a second straight day.Japan's Nikkei average .N225 rose 0.7 percent to 22790.68 in early trade. The euro EUR= rose to a two-week high, while the 10-year U.S. Treasury yield US10YT=RR hit a 1-1/2-week peak on Wednesday, after officials said the European Central Bank could wind down its stimulus program by the end of the year.
Punjab PDWP approves development scheme
The Punjab Provincial Development Working Party (PWDP) Wednesday approved development scheme of road sector with an estimated cost of Rs 1210.813 million. Presided over by P&D chairman Muhammad Jahanzeb Khan, the 73rd meeting of PDWP for the current fiscal year 2017-18 gave approval of the scheme. The approved development scheme is: Construction of 2nd bridge over River Ravi near Saggian at Lahore (revised) at the cost of Rs 1,210.813 million.
FBR asked to make all-out efforts to achieve Rs3.93tr target
Federal Minister for Finance and Revenue Dr Shamshad Akhtar on Wednesday directed Federal Board of Revenue (FBR) chairman to make all possible efforts to achieve the revised revenue collection target this year, which seems challenging. Federal Minister for Finance and Revenue chaired a meeting to review the performance of the FBR in the current financial year (2017-2018). Sources informed that meeting was informed that FBR would have to collect mammoth Rs661 billion in the ongoing month (June) to meet the revised tax collection target of Rs3.935 trillion for current fiscal year. The federal government had already revised the tax collection target of FBR to Rs3.935 trillion for the outgoing fiscal year from the Rs4.013 trillion. However, the FBR officials believe that they may not achieve the target, as collecting Rs661 billion in single month is a gigantic task. The FBR had collected Rs3.274 trillion during eleven months (July to May) of the ongoing fiscal year as against Rs2.854 trillion during the same period of the previous fiscal year, registering 14.4 percent growth in collection.
17pc growth in companies’ registration in May: SECP
The Securities and Exchange Commission of Pakistan (SECP) registered 1,094 new companies in May this year, showing growth of 17 percent as compared to the corresponding month of last financial year. The total number of registered companies increased to 86,876. The massive increase is the result of the SECP’s various reforms measures, i.e. introduction of simplified combined process for name reservation and incorporation, reduction of fee, assistance of incorporation by facilitation wings of CROs etc Foreign investment has been reported in 56 new companies. These companies have foreign investors from, Canada, China, Czech Republic, Denmark, Iran, Jordan, Korea (South), Lebanon, Nepal, the Netherlands, Oman, Saudi Arabia, Singapore, Tanzania, Turkey, Ukraine and the US. The highest numbers of companies, i.e. 402 were registered in Islamabad, followed by 271 and 226 companies registered in Lahore and Karachi respectively. The CROs in Peshawar, Multan, Gilgit-Baltistan Faisalabad, Quetta, and Sukkur registered, 60, 42, 39, 31, 14 and 9 companies respectively.
Pak growth to slow down to 5pc in FY2018-19: WB
The World Bank on Wednesday noted that Pakistan’s GDP growth would slow down to 5 percent in next fiscal year from 5.8 percent of the outgoing year. Pakistan’s GDP growth rose to 5.8 percent in FY2017/18, supported by infrastructure projects funded by the China-Pakistan Economic Corridor (CPEC), improvements in energy supply, and persistent private consumption growth, the World Bank (WB) stated in its ‘June 2018 Global Economic Prospects report’. The government had set GDP growth target at 6.2 percent for the next fiscal year after achieving 13-year high growth of 5.8 percent during FY2017/18. The Asian Development Bank (ADB) had already estimated that Pakistan’s economy is expected to slow down to 5.1 percent in the next fiscal year 2018-19 because of growing external account challenges. After ADB, the WB has also forecasted that GDP growth would slow down in next fiscal year.

The Benchmark KSE100 Index is capped by a descending trendline on daily chart along with a horizontal resistance at 44,230 and 44,470 points. Daily Stochastic is trying to generate a bearish crossover and it would succeed if index would close below 43,860 points during current trading session. Index would remain under pressure during current trading session which would lead it towards a bearish rally in coming week. Index also have completed 61.8% correction of its last bearish rally and this correction level would also try to cap current bullish momentum. If index would not become able to close above 45,036 in coming days then a new bearish momentum towards 39,200 could be witnessed.