Author: Shabbir Kazmi

Progress with IMF likely to push sentiments The market remained jittery during the week ended on August 26, 2022. Political uncertainty was further enhanced after a case was registered against ex-prime minister Imran Khan in the Anti-Terrorism Court. This shadowed positive news regarding foreign exchange inflows and SBP keeping interests rates unchanged. Erosion in Pak rupee value against the dollar continued, with the currency depreciating 2.72% against the greenback over the week, to close at PKR220.66/US$. The benchmark index lost 679 points, down 1.57%WoW. Participation in the market was also lackluster, with average daily traded volume dropping by 52%WoW to…

Read More

This year Pakistan is celebrating Independence Day, when the clouds of imminent are getting thicker. While the people have complete faith in the economic resilience, a lot needs to be done on war footings. People are worried about the ballooning confidence deficit. They believe that breaching current account deficit and budget deficit is possible but overcoming confidence deficit may take years. The brighter side of the story is that International Monetary Fund (IMF) is likely to release promised branch of about US$1.2 billion. This will pave way for the inflow of foreign exchange from friendly countries and other multilateral lenders.…

Read More

Bulls control likely to linger Bulls finally returned to Pakistan Stock Exchange as the looming threat of a potential default on foreign debt eased off with a couple of friendly countries stepping forward to bail out Pakistan from the crisis situation. The monthly external trade numbers were also announced this past week ended on August 05, 2022. The trade deficit pleasantly surprised consensus estimates owing to larger than anticipated squeeze on imports. Consequently, the KSE-100 gained 4.85% to close at 42,096 points, amid significantly better volumes with average volume for the index recorded around 268.61 million shares up 78.9%WoW, as…

Read More

Pakistan Stock Exchange (PSE), concluded FY22 with the benchmark index returning negative 12.3%, while on the back of hefty currency depreciation of 30%YoY during FY22, the dollar adjusted return throughout FY22 came to negative 42.3% making the KSE-100 index one of the worst performing indexes in the region. Amid tough economic outlook, the market participation remained dull throughout FY22, with the average daily traded volume during the year reported around 292.7 million shares as opposed to 527.4 million shares it averaged during FY21. As for the outgoing month, the average trading volume was slightly above the yearly average, clocking around…

Read More

Over 300 units closed due to cut in gas supply, says APTMA chief Abdul Rahim Nasir, Chairman, All Pakistan Textile Mills Association (APTMA) claims that over 300 textile units have been closed due to the cut in gas supply. He urged the Government of Pakistan (GoP) to immediately restore gas supply to the textile industry. Explaining gravity of the situation, he said Pakistan has already lost almost US$1 billion of textiles and clothing exports. Accompanied by APTMA, North Zone Chief, Hamid Zaman and Senior Vice-Chairman Kamran Arshad at a press conference, he said the 26 percent upsurge in the export…

Read More

Macro, political uncertainty may keep activity sluggish Pakistan Stock Exchange (PSX) witnessed a turbulent week ended on July 22, 2022, on account of political uncertainties mainly on the back of Punjab elections and massive currency depreciation on the back of oil payments. The index dropped by 1,968 points or 4.75%WoW to close at 40,077 points, while activity remained subdued as compared to last week. On the macro front, PKR/US$ depreciation was a shocker, as the domestic currency fell by 8.3% to PKR228 for a US$. Furthermore, PTI’s victory in the by-election of Punjab caused further uncertainty, prompting international credit raters…

Read More

In recent years, financial inclusion has been one of the most discussed issues in Pakistan. Growing awareness and availability of IT facilities has resulted in easy accessibility to banking services. Now the brick and mortar concept of bank branch has been replaced by click. Now the use of mobile banking and in particular, payments by mean of smartphones has tremendously increased across the country. In today’s world, smartphones are one of the most important media for communication and also a medium or channel for financial inclusion as they are easily penetrated in the population and are feasible of interconnecting data…

Read More

In order to promote digitalization and encourage eco-friendly practices, the State Bank of Pakistan (SBP) has developed online portal called SBP Regulatory Approval System (RAS) to enable regulated entities (Banks, Electronic Money Institutions, Payment System Operators and Payment Service Providers etc.) to submit cases/proposals and receive regulatory decisions digitally. Previously, SBP implemented RAS for its various functions aimed at end-to-end digitalization, whereby banks were enabled to electronically submit cases related to Banking Policy & Regulations and Exchange Policy. With the launch of RAS, Banks, Development Finance Institutions (DFIs) and Microfinance Banks (MFBs) started submitting their request letters/ proposals on a…

Read More

PSX Witnessed a dull week amid uncertainties regarding IMF Program Pakistan Stock Exchange (PSX) witnessed a dull week ending on July 07, 2022 on account of uncertainties regarding IMF program, expectation of further monetary tightening and political turmoil. The benchmark index declined 286 points or 0.69% to close at 41,344 points. During the week, SPI print witnessed an uptick of 363% due to higher food and energy prices. Country’s trade deficit for the year was reported at US$48.25, up by 55%. Oil prices witnessed significant decline during the period and fell by 11.5%, due to fears of global recession. Similarly,…

Read More

As oil demand unwinds in the wake of falling global growth, natural gas/LNG markets continue to remain tight in this ongoing energy crisis. Pakistan too has imported its two most expensive LNG shipments in the months of May and June 2022. The country’s LNG import bill climbed up to US$762/US$724mn in May/June as compared to the Jan-April average of US$370mn/month. Moreover, Pakistan LNG Limited (PLL) recently invited spot bids for July shipments after failing to procure them in the previous two weeks. The country’s one of only two LNG importers received a single bid to buy four cargoes for July…

Read More

Geopolitical conflicts have imposed certain restriction on the outflow of Russian oil and gas. This has spiked energy cost and initiated a quest for other fuels. Under the prevailing conditions two of the largest energy consuming countries, China and India are fast reverting back to coal. Pakistan, enjoying the treasure of Thar coal can cap its energy import bill. Speaking at the Bloomberg Qatar Economic Forum in Doha recently, Exxon-Mobil CEO Darren Woods said he does not see oil prices cooling down over the next few years. Woods said that it would take some time for the volatility in the energy market to end.…

Read More

SMIDGEN gains witness; stocks may likely go up Announcement of Federal Budget FY23 by the Government of Pakistan (GoP) brought some stability to the local stock market. There is overwhelming perception that the Budget has been prepared keeping in view the conditionalities of the International Monetary Fund (IMF). The benchmark index of Pakistan Stock Exchange posted a nominal increase of 0.3%WoW for the week ended on Friday, June 17, 2022. It recovered sharply after shedding 1,135 points on the first trading session of the week. The market participation picked up slightly where the average daily turnover increased 2.6%WoW to 174.2…

Read More

In the last few weeks, the government has significantly reduced fuel subsidies, while passing legislation to reform state-owned entities and set up an Export-Import Bank to take over the SBP’s refinance facilities. Efforts to recapitalize two private sector banks have also accelerated. These measures are part of the structural benchmarks agreed upon with the IMF in February. The FY23 Budget is part of the same chain. Some aspects will be challenging, for instance meeting the large target for petroleum levy will likely be politically difficult, but it is heartening to note the finance minister stated in his speech that the…

Read More

Contrary to market expectations, measures announced in Federal Budget FY23 are being termed ‘Neutral to Positive’ for the stock market. With IMF program in sight, there was a general expectation that there may be very tough measures across all sectors. However, the government has announced a mix of positive and negative measures for listed sectors. Some of the key measures announced in budget relating to stock market and sectors include: Tax on all persons including companies and AOPs where the income exceeds Rs300 million are now subject to an additional tax at the rate of 2% of such income. This…

Read More

Uncertainty still prevails The week ended on June 03, 2022 witnessed sluggish movement in the first three days and the market took a hit on Thursday and Friday. The benchmark index, KSE-100 lost 3.6%WoW to close at 41,315 points. Economic uncertainty along with rising interest rates and bond yields kept the sentiments subdued. Average daily trading volume for the Index declined to 10 million shares, posting 25.3%WoW decline. Major news flows during the week were: 1) GoP increases prices of POL products, 2) Pakistan agrees terms for rollover of US$2.3 billion debt from China, 3) Moody’s changes the outlook for…

Read More

The growing population of smartphones and introduction of newer applications have contributed a lot towards financial inclusion. Over the years, one of the biggest handicaps of commercial banking has been a limited number of bank accounts, particularly in the low-income groups and remote areas. Banks have been reluctant to establish brick and mortar branches in these areas. To address this important problem, Easypaisa can rightly take pride in having led the fintech revolution in Pakistan as soon as it came into existence. Easypaisa was launched in Pakistan in 2009 as a peer-to-peer money transfer service. However, its biggest contribution is…

Read More

In its meeting on May 23, 2022, the Monetary Policy Committee (MPC) decided to raise the policy rate by 150 basis points to 13.75%. This action, together with much needed fiscal consolidation, should help moderate demand to a more sustainable pace while keeping inflation expectations anchored and containing risks to external stability. Since the last MPC meeting, provisional estimates suggest that growth in FY22 has been much stronger than expected. Meanwhile, external pressures remain elevated and the inflation outlook has deteriorated due to both home-grown and international factors. Domestically, an expansionary fiscal stance this year, exacerbated by the recent energy…

Read More

Choppiness prevails; investors may turn cautious Week ended on May 20, 2022 started on a bad note with the benchmark index declining by 1.9% on the first trading day as lack of economic direction weighed heavily. Even though the market recovered in later trading sessions, but overall performance remained choppy, lacking clear direction throughout the week. Finally, the market closed the week at 43,101 points, down 0.89%WoW. Average daily trading volume also slipped to 220.8 million shares, from 274.04 million for the earlier week. Overall, political uncertainty and indecisiveness over prerequisites for IMF program resumption put Pakistan’s economic situation into…

Read More

Cement dispatches for the month of April were reported at 3.54 million tons, down 30%MoM, mainly due to shortened working hours and slowdown in construction activity during the month of Ramadan coupled with rising construction cost amid inflation, and cut in public sector development expenditure restricting growth in demand. Accordingly, local dispatches were registered at 3.37 million tons, down 29%MoM, while exports were reported at 0.16 million tons, down 47%MoM mainly due to: 1) all-time high freight costs and 2) low retentions in the export markets restricting exporters. Therefore, cement the manufacturers preferred to sell domestically where they enjoy greater…

Read More

Little recovery seen after a positive development with IMF Following a 1,049 points decline a week ago, the market recovered 520 points on the first trading session of the week ended on April 28, 2022 on the back positive development with International Monetary Fund (IMF). According to their spoke person, the IMF delegation is expected to visit Pakistan in May. In addition to this, the length of the program is also expected to increase till June 2023 with additional US$2 billion financing arrangement, taking the total program size to US$8 billion. The upward movement, however, was short lived as the…

Read More

During March 2022, Pakistan received a total of US$2.8 billion of inflows under workers’ remittances. During the month under review the remittances increased by 28.3%MoM and 3.2%YoY. This is the highest ever monthly level for workers’ remittances. A point worth noting is that the remittances have continued their unprecedented run and remained above US$2 billion since June 2020. Cumulatively during first nine months of the current financial total remittances received recorded at US$ 23.0 billion, posting a growth of 7.1% as compared to the same period of the last year. Remittances inflows during March 2022 mainly originated from Saudi Arabia…

Read More

Positive motion likely to persists amid result season The momentum gathered in the last trading session of earlier week, fueled further on the first trading session of the week ended on April 15, 2022. The investors across the board welcomed newly formed government; set up of coalition parties (PML-N, PPP, JUI-F and MQM-P) led by Shehbaz Sharif as newly elected Prime Minister. Filled with exuberance, the benchmark KSE-100 index registered 1,700 points gain on Monday – the largest single day return of 3.83%DoD to close the index at 46,145 points. The rally continued throughout the week, keeping KSE-100 index above…

Read More

Gains witnessed; long-term positions in focus Momentum gained in the earlier week continued into the week ended on April 01, 2022. The benchmark index gained 3.7% WoW, the strongest weekly return since April 2022 to close at 45,152 points. Participation also improved during the week, with average daily trading volume rising to a little above 310 million shares – the highest in 11 weeks, with side scrips garnering investor attention. Major news flows during the week were: 1) No-trust resolution against PM Imran Khan tabled in the National Assembly, 2) Punjab Chief Minister tendered his resignation to make space for…

Read More

Banks approve on spot conditional housing loans amounting to Rs7.4 billion In an overwhelming response to the first ever Mera Pakistan Mera Ghar (MPMG) Mela organized by State Bank of Pakistan in Faisalabad, banks logged in applications of Rs18 billion from applicants. In the two-days Mela, held on March 19-20 more than 30,000 people visited to obtain information about the MPMG and apply for loans through banks’ one-window facilitation. Against the applications logged in, banks provided conditional approvals of around Rs7.4 billion loans. At the inauguration ceremony of the Mela, Dr. Reza Baqir, Governor State Bank in his keynote address…

Read More

Political instability may keep market down The benchmark index of Pakistan Stock Exchange KSE-100 Index shed 623 points during the week ended on March 18, 2022, mainly during the last 2 sessions. This led to 1.43%WoW decline in total market capitalization of the Index. The daily trading volumes also dried up to 174 million shares as compared to 214 million shares a week ago, posting 18.6%WoW decline. The market’s downward drift has been due to further escalation in country’s political uncertainty as we approach close to 28th March, the day when no-confidence vote is due. Similarly, the uncertainty in global…

Read More

Cement is the most important component of the construction industry. Any hike in coal price contributes towards hike in cement price. At times, manufactures are able to pass on the increase in cost of cement to buyers, but at times, which sales are lean, passing on the cost may not be possible. Anticipating the hike in construction cost is important not only for the construction companies, but also for the financial institutions in the business of mortgage finance. If the actual hike beats, the estimates, construction face the doubled-edged soward, on one hand pace of work slows down due to…

Read More

IMF talks may lead sentiments; major stocks to shine During the week ended on March 11, 2022 global commodity prices reach unparalleled highs, affecting the market, KSE-100 losing 2.0%WoW to close at 43,653 points. Local political uncertainty along with central bank’s hint of potential further tightening (as a result of commodities super cycle) also negatively contributed to market sentiments. However, average daily trading volume was up 0.3% to 213 million shares this week. Other major news flows during the week were: 1) FATF retaining Pakistan on the grey list, 2) GoP pursuing financial support of about US$21.7 billion from China…

Read More

SBP wins another award for promoting Islamic finance Islamic Finance News (IFN), an arm of REDmoney Group, Malaysia, has announced State Bank of Pakistan (SBP) as the best Central Bank of 2021 across the world in promoting Islamic finance. The result was based on global voting. IFN Best Banks Poll is regarded as one of the prestigious accolades in the global Islamic finance space. Bank Negara Malaysia stood second while the Saudi Central Bank secured third position. The category of the Best Central Bank in promoting Islamic Finance is one of the closest contested among regulators around the globe for…

Read More

Newfound system helps facilitate P2P transactions Imran Khan, Prime Minister of Pakistan launched the second phase of Raast, called Person-to-Person instant payment system in a ceremony in Islamabad. Raast, a flagship initiative of the State Bank of Pakistan (SBP) is a payment system platform that enables various types of transactions among different stakeholders such as organizations, businesses and persons. The objective of this initiative is to promote digitization and financial inclusion in the country. In the first phase of Raast, launched in January 2021, transactions from organizations to persons, generally referred to as Bulk Payments, were enabled. The second phase…

Read More

Negative sentiments prevail; value stocks may shine During the week ended on February 25, 2022, negative sentiments engulfed the market following the escalation in Russia -Ukraine conflict where President Putin gave green signal to invade Ukraine. Following this news, the benchmark KSE-100 index slipped 3% alone on Thursday, plunging the index down to 43,984 points by the end of week. During the week, Brent Oil flirted with US$100/bbl level, while other global commodities such as Natural Gas/Wheat/Coal rallied 24/16/4% on supply concerns. The average daily trading volume increased 20%WoW to 228.5 million shares as investors made their way to dispose…

Read More

The Ministers of the OPEC plus, who met via video conference, rubberstamped in just 16 minutes the monthly production hike by 400,000 bpd. In the shortest meeting so far in its history, OPEC+ decided to increase the collective production by 400,000 barrels per day (bpd) in March 2002. This left production plan unchanged and pushed Brent price above US$90/barrel. Some analysts, and traders, had expected a higher production increase, considering the recent rally that has frustrated major oil-consuming nations, including the United States. Earlier this week, Goldman Sachs had expressed the view that OPEC plus might decide to announce a larger production increase for…

Read More

Market set to maintain bull run After gaining 1.8%MoM during January 2022, the positive momentum continued during the first week of February with index gaining 1.85%WoW in anticipation of normalization of relations with the IMF. Average daily trading volumes increased by 54%WoW to 289.1 million from 187.4 million shares a week ago. During the week, activity shifted slightly to small-cap stocks from mainboard items. Major news flows during the week included: 1) GoP and IMF finally reaching an agreement to revive US$6 billion program, with IMF likely to disburse US$1.0 billion immediately, 2) Pakistan raising another US$1.0 billion through issue…

Read More

A point to be noted is that local urea manufacturers have an installed capacity of 7 million tons per annum as against estimated offtake of around 6 million tons. This clearly indicates that the industry can earn substantial foreign exchange by operating plants at optimum capacity utilization. However, to achieve this uninterrupted supply of gas has to be guaranteed. This requires dedication of Mari field to the fertilizer industry. Although, this decision was made in Fertilizer Policy 2001, some power plants are still getting gas from this field. FFBL: A bumper year Fauji Fertilizer Bin Qasim (FFBL) is expected to…

Read More

Index falls; IMF program  may likely set tone Putting an end to 6-week streak of positive returns, on Friday January 21, 2022 the KSE-100 index closed at 45,018 points, down 1.63%WoW. The fall was attributed to a sharp increase in oil prices due to geopolitical risks in the Middle East and widening Credit Default Spread (CDS) on Government of Pakistan (GoP) bonds denting investors’ sentiments amid lack of triggers Average daily trading volumes dried up, falling to 201.2 million shares, falling from 355.6 million shares a week ago. During the week, activity shifted slightly to small-cap stocks from mainboard scrips. Stock…

Read More

Lack of consensus among urea producers, policy planners A tug of war has been going on between the elements adamant at importing urea and its local manufacturers. With regular intervals the need for importing urea is raised, whereas the industry experts have a contrary view. There prevails a consensus among urea manufactures that they are capable of exporting up to one million tons urea per annum, if the right impetuses are provided: uninterrupted gas supply and control over smuggling of urea to the neighboring countries. It may be recalled that lately Imran Ahmed, CFO, Engro Fertilizers in an interview highlighted…

Read More

Upcoming monetary policy may define direction During the first week of the New Year, ended on January 07, 2022, the benchmark index of Pakistan Stock Exchange (PSX) closed at 45,346 points. Average daily trading volume rose to 318 million shares, from 218 million shares a week ago. Major gainers were: STJT, HUBC, ISL, GATI and UNITY, while top laggards included: TRG, HMM, MUREB, PMPK and KTML. Tabling of Finance Amendment Bill and State Bank of Pakistan Amendment Bill during the latter part of the week indeed provided confidence to investors on the eventual resumption of IMF program. Other important news…

Read More

After an unexpected increase in cut-off yields in last T-Bill auction on December0 1, 2021, money market yields have been on a rising trend recently. Bond yields are up 136-144bps since SBP increased the policy rate by 150bps on November 19, 2021. Since the last PIB auction on November 29, 2021, bond yields on 3-5 year PIBs are up around 50bps to 11.89% and 11.91%, respectively. In 2021 to date, bond yields on 3-5 years bonds are up 362bps and 266bps, respectively. This is on expectations of further rate hike going forward on the back of rising inflationary pressures and…

Read More

The Monetary Policy Committee (MPC) of State Bank of Pakistan (SBP) decided to raise the policy rate by 100 basis points to 9.75%. The goal of this decision is to counter inflationary pressures and ensure sustainable growth. Since the last meeting on November 19, 2021, indicators of activity have remained robust, while inflation and the trade deficit have risen further due to both high global prices and domestic economic growth. In November, headline inflation increased to 11.5%YoY. Core inflation in urban and rural areas also rose to 7.6 and 8.2 percent, respectively, reflecting domestic demand growth. On the external side,…

Read More

Performance may range-bound; mini budget in focus Stock Market remained flat throughout the week ended on December 24, 2021 posting a nominal increase of 0.5%WoW to close in at 44,118 points level. This took the cumulative performance throughout CY21 to 0.8% whereas USD adjusted return currently stands at negative 9%. Volumes dried up significantly on WoW bases and average daily traded volume was recorded at 215 million shares as opposed to 265 million shares, down 18.7%WoW. Top performers of the market included: BNWM, HCAR, TRG, PSX and ABOT. The laggards were: ARPL, SFL, GATI, COLG, and JDWS. The performance during…

Read More

Decline in trade deficit a sigh of relief; monetary policy eyed After taking a heavy beating during earlier week on the back of high trade deficit for November 2021, the market took a breather on the first trading session of the week. In the second session the news of assistance from Saudi Arabia provided some relief and the market rallied 1.3% during the session. However, towards later part of the week, market set its sight on the upcoming monetary policy meeting and remained under pressure on the expectations of an increase in interest rate and depreciating PKR. Overall, the benchmark…

Read More

Overseas Pakistanis have sent the highest-ever US$8 billion remittances during the first quarter of the current fiscal year, registering an increase of 12.5% over the same period last year. The State Bank of Pakistan (SBP) reported that with inflows of US$2.7 billion in September, workers’ remittances continued their strong momentum and have remained above US$2 billion since June 2020. “This is the 7th consecutive month when inflows recorded around US$2.7 billion on average,” said the SBP. In terms of growth, remittances increased 17% in September as compared to the same period last year, while comparing with August inflows it was…

Read More

There is no denying to the fact that Pakistan has to boost its exports to contain ever-growing trade deficit. Pakistani exporters have to get acquainted with Harmonized System numbers —known as HS codes. It is anticipated that changes will take effect to the official nomenclature for hundreds of product groups used to classify imports and exports. There exists more than 5,000 product categories developed by the World Customs Organization, an inter-governmental group in Brussels, which are updated every five years or so. In 2022, the biggest changes are coming for electrical machinery and parts, wood, textiles, fish and organic chemicals. The…

Read More

Trade has historically been a powerful driver of economic growth and poverty alleviation in Asia. While tariff barriers to trade in Asia are low overall, a new measure of non-tariff barriers suggests those remain high in many Asian emerging markets and developing economies. Unlike tariffs, these barriers include policies that introduce frictions such as licensing requirements or restrictions on trade, payments and exchange foreign currencies. Reducing trade barriers can reignite growth engine. Concerted efforts have to be made to liberalize trade, invigorate sustainable growth and minimize post pandemic scarring. According to a recent research, as detailed in the International Monetary…

Read More

Index falls despite IMF staff level agreement news Despite the positive news-flow regarding the IMF staff level agreement, the benchmark index of Pakistan Stock Exchange (PSX) trimmed the last week’s gains on account of unexpected hike of 150bps in policy rate by SBP. In addition to this, the Current Account Deficit (CAD) widened by US$1.66 billion in October 2021 and rose to 4.7% of the GDP from 4.1%, beyond the target of 2-3% for the entire financial year. With negative news-flows engulfing the investors, the confidence remained jittery. At the same time, PKR remained on downward trajectory against US$, hitting…

Read More

It is a phenomenon rarely seen in commodity markets, natural gas prices are skyrocketing across the world, Europe and Asia and consumers are paying up to nearly six times more for natural gas as compared to the US consumers. This is being attributed to a lack of the US liquefaction capacity. On Tuesday in New York, front month contracts for Henry Hub gas futures closed above US$5.88 per million BTUs, more than doubling in the year to date. The fuel topped US$6.46 on October 6, marking the highest level since 2014. On top of climbing air conditioning demand in the…

Read More

Engro Energy Limited (EEL) signed a Memorandum of Understanding (MoU) with the Sindh Transmission and Dispatch Company (STDC) and the Directorate of Alternate Energy (DAE) to establish a renewable energy park at Jhimpir that will provide electricity to industry at Port-Qasim and Dhabeji. Under the terms of the MoU, Engro will be responsible to build the first hybrid solar PV and wind park in the country whereas STDC and DAE will be responsible for laying the transmission network and facilitate the provision of required land for the project, respectively. The MoU jointly spearheaded by the Government of Sindh was witnessed…

Read More

Index to keep rallying on IMF review outcome Extending rally for the fourth consecutive week, the benchmark index closed the week ended on November 06, 2021 at 47,296 points, up 2.33%WoW. It was the highest weekly gain since May 2021 as investors turned optimistic on a possible breakthrough in much awaited IMF review and the incumbent government possibly regaining political capital through Rs120 billion subsidies on key food commodities. Trading volumes also improved with daily average turnover rising to 429.7 million shares during the week as compared to 219.1 million shares a week ago, it was the highest in last…

Read More

In Europe, the high nutrient prices have farmers questioning whether to curb plantings. Canadian authorities cautioned that growers may cut back on usage, while in corn powerhouse Brazil, there’s a risk that soaring fertilizer costs and less supply will limit crop yields. The global fertilizer market had already been tightening before plants were forced to cut production on the back of the recent spike in the cost of gas, a key feedstock. That’s sent prices of nutrients crucial for growing staples soaring — to a record in some cases — risking smaller harvests or even more expensive food down the line. Fertilizer plant shutdowns in the UK highlighted how critical the situation is, because it…

Read More

Use of phosphate fertilizer is on the rise but its raw material is depleting fast The world faces an imminent crisis in the supply of phosphate, a critical fertilizer that underpins the world’s food supply. Phosphate is an essential mineral for all life on earth and is added to farmers’ fields in huge quantities. But rock phosphate is a finite resource and the biggest supplies are mined in politically unstable places, posing risks to the many countries that have little or no reserves. Phosphate use has quadrupled in the last 50 years as the global population has grown and the…

Read More

Interview with Mr Nasib Ahmed Saifi – an exporter of Halal meat [box type=”shadow” align=”” class=”” width=””]Profile: CEO: Anis Associates (Pvt) Ltd. Chairman: Saifigroup of Companies (U.A.E., Pakistan, Thailand, Bahrain & K.S.A.) Chairman: Standing Committee on Halal Food Import & Export – LCCI Chairman: FPCCI (Central) Standing committee on “Halal Meat Import & Export” Chairman: All Pakistan Meat Exporters & Processors Association Former Member: Executive Committee Member – LCCI Patron: The Lahore General Hospital – Lahore[/box] Pakistan has an overwhelming majority of Muslim population as well as enjoys enormous population of livestock. However, country’s share in global Halal meat has…

Read More

Index may stimulate on important IMF talks In a shorter than usual week, market remained volatile. The start of the week witnessed across the board selling as investors became jittery on the news that IMF talks remained inconclusive. However, once a clarification was published that negotiations were still going on; market took a sigh of relief on second day of the week and gained 1.9% in a day. The same momentum was carried into third trading day. However, on the fourth day, news flow regarding IMF discussions again caused jitters and a sell-off was witnessed. The benchmark index closed the…

Read More

Pakistan and the International Monetary Fund (IMF) are still talking about raising taxes and electricity tariff at the last leg of technical-level discussions to put US$6 billion Extended Fund Facility (EFF) back on track. The virtual talks between the two sides on Friday were extended at the last moment for 8-10 hours as they struggled to narrow down their hard positions to a level that Finance Minister Shaukat Tarin could strike a deal during policy-level talks with the IMF management and mission chief next week. The IMF staff had termed Pakistan’s revenue growth ‘unsustainable’ as it could reverse as soon…

Read More

Meteorologists are predicting a cold winter, and it could send international energy prices even higher. Record high natural gas prices have forced some utilities to switch to oil, boosting demand for crude. It is feared that oil prices may witness further rise, though not likely to stay there for long. The spike in oil prices to the highest in years came after OPEC plus decided not to add more barrels than the initially agreed 400,000 bpd monthly. Analysts say that prices could witness further increase. Now, some forecast price may rise to US$100/barrel. The good news is that even if…

Read More

Bears rule, results and other news focus of attention Reeling from the previous week’s dejected performance; Pakistan Stock Exchange (PSX) witnessed bearish sentiments throughout the week. The week ended on October 08, 2021, closed the benchmark index at 44,477 points, posting a decline of 395 points or 0.9%. An upsurge in global commodity prices (Coal hit US$238/ton and Brent hit US$83.1/barrel), widening trade deficit and higher inflation kept the investors’ sentiments subdued. In addition to these, the upcoming IMF review and political uncertainties also dampened investors’ sentiments. Cement sector was among the top laggards for the week, losing 5.6%WoW as…

Read More

Benchmark lending rate hikes to 16-month high Cut-off yields on Treasury Bills (T-Bills) spiked by up to 49 basis points (bps) in the auction held on Wednesday. It is the first increase of this magnitude during the last 15 months. Most of the bids received by State Bank of Pakistan (SBP) were for three-month tenor. The auction target was Rs800 billion, total bid received amounted to Rs1.171 trillion, but the central bank accepted bid worth Rs731 billion. The increase in cut-off yields was warmly welcomed mainly be the banks evident from the amount offered to buy the papers. Bids of…

Read More

Stocks continue gloom-ridden venture Moving along the trend set in motion in previous week, Pakistan Stock Exchange posted negative performance throughout the week. On last trading day of the week ended on 24th September 2021, bench mark index closed at 45,073 points, touching a low of 44,788 points. Over the outgoing week, the index cumulatively lost 1,562 points or 3.4%. A 25bps hike in interest rates by the central bank suggests further hikes in future. Other major news flows during the week included: 1) the central bank tightening regulations on consumer financing and mandating banks to share 5-day import payments…

Read More

I am delighted to share these lines from an article by Matthew Boyle. I quote, “Any company that says they fully understand their supply chain is lying,” says Goentzel, who believes that supply-chain practitioners should be certified just like accountants. “It’s time for the profession to wake up. The 20th century was about finance. The 21st century should be about supply chains.” On can recall that just-in-time inventory system embraced by many businesses led to empty shelves and costly bottlenecks. Some of the headlines were never seen before. These included: Stores with no toilet paper, colossal cargo ships run aground in the…

Read More

It is heartening to note that the cargo handling activities at the two ports located in Karachi – Port Bin Qasim and Karachi Port have recorded an impressive growth of 25% and 13.72% in FY21. This increase can be attributed to 18% in exports and 26pc rise in the country’s exports and imports, respectively. Reportedly, exports in FY21 rose to US$25.3 billion from US$22 billion in FY20. Imports rose to US$56 billion from US$44.5 billion during this period. This kept goods movement at twin ports alive amid issues like lockdown, port congestion, higher freight charges etc. all over the world.…

Read More

Interview Hasan Faraz, Manager, Pakistan Area Customer Experience, Maersk PAGE: What does Customer Experience mean to Maersk? Hasan Faraz: Customer experience for us at Maersk essentially means the holistic perception of what our brand and business stand for. We are keeping our customers at the heart of every decision we take and therefore customer experience revolves around customer-centric mindset, where the end-result is to constantly improve our customers’ satisfaction and resulting in their ever-growing loyalty towards Maersk. Customer Experience is an integral part of all our offerings allowing us to differentiate ourselves in the industry from others. Our Customer Experience teams…

Read More

PSX remain under pressure due to high trade deficit coupled with depreciating Rupee Pakistan stock market started the week ended on 10th September 2021 under pressure. Investors awaited MSCI’s decision of downgrading Pakistan to Frontier market status from Emerging Market, resulting in selling in some index heavy stocks. Additional pressure was evident on the market due to high trade deficit for August 2021 coupled with depreciating Rupee. However, on fourth and fifth trading day of the week, market rebounded, led by technology sector and recovered almost all the losses for the week. The benchmark index closed at 47,198 level, up…

Read More

The benchmark index of Pakistan Stock Exchange, KSE-100 Index is celebrating its 30 years of existence. The Index is total return market capitalization based, which was created in 1991 with a base value of 1,000 points. Following international best practices the benchmark Index calculation methodology was changed from full market capitalization to free float market capitalization in October 2012. Some other indices have been created since 1991 i.e. KSE-30 All Share and KMI-30, but KSE-100 Index still remains most followed and most reported indicator of stock price movements in Pakistan. The Index comprises of 100 companies selected on the basis…

Read More

PSX remains under pressure as of weak market sentiments Pakistan Stock Exchange (PSX) remained under pressure during the week ended 27th August 2021, apart from Monday, where the benchmark index crossed the much anticipated barrier of 48,000 points to close at 48,112. The weak market sentiments, coupled with Rupee depreciation, geopolitical tensions in the region and uncertainty over talks with IMF continued to dampen investors’ confidence during the rest of the week. The index could not sustain the massive selling during week and cumulatively lost 463 points, down 0.97%WoW, to close at 47,137 points. Despite receiving US$2.7 billion inflow under…

Read More

Heavy rains and floods in China and Europe have recently dominated headlines around the globe. Most-affected was China’s Henan province, home to one-tenth of country’s total agriculture output and 36% of China’s total primary Lead capacity (used in batteries) and 15% of recycled Lead capacity. Western Europe (Germany, Belgium and the Netherlands) embraced highest rainfall in decades, causing transportation and production disruption in the Rhine valley – a major shipping route for commodities in Northern Europe. Moreover, Rhineland-Palatinate and North Rhine-Westphalia region (areas most hit in Germany) are home to manufacturing facilities of top steel producers. Disruptions in steel supply…

Read More

Index regains momentum, covid 4th wave may worry sentiment Pakistan Stock Exchange (PSX) remained range bound during the week ended 13th August 2021 and closed at 47,170 points, down 0.67%WoW. The geopolitical uncertainty kept the investors at bay, evident from 37.8%WoW decline in average daily turnover to 306 million shares. Key data points released during the week included: 1) trade deficit for July 2021 rising to US$3.1 billion, up 85.5%YoY on increase in global crude oil price and 2) remittances remaining stable at US$2.71 billion. The auto numbers released showed PSMC/INDU recording highest ever monthly sales with 15,181/6,715 units, on…

Read More

Telecommunication companies and commercial banks have been converging for years. According to some sector experts, banks are witnessing greater competition from telecom operators, which are aggressively entering into financial services, especially in transactional lines of business. Therefore, there is a need to explore the opportunities for complementing each other to attain greater synergy. Retail banks have been eager to push digital channels, such as fixed and mobile, as an important part of their operations, since they started offering services to their clients through the web almost 20 years ago. Today, all banks are facing the digital age with a broad…

Read More

The State Bank of Pakistan (SBP) has issued its flagship annual publication, the Financial Stability Review (FSR) for CY20. The Review presents performance and risk assessment of various stakeholders in the financial sector including banks, non-banking financial institutions, financial markets, non-financial corporates and financial market infrastructures. The FSR highlights that CY20 was a challenging year for the financial sector as COVID-19 pandemic triggered deepest global recession since the Great Depression. Besides enormous loss of lives worldwide due to this health crisis of epic proportions, economic activities were severely disrupted. To mitigate the adverse implications, national authorities and central banks around…

Read More

As the data centre landscape continues to, the industry is expected to grow exponentially. With growing reliance on digital connectivity, evolve demand is likely to ramp up further due to the imminent rollout of 5G, IoT-linked devices, data localization and cloud adoption. The 5G, the next big thing in Pakistan telecom, is not just about communications. If 4G was for data, 5G would be for device connectivity. The superfast 5G network is expected to create a network of connected devices, enabling millions of applications capable of transforming every sector and every minute event happening across the country. Time is changing…

Read More

Stocks end flat, results season in limelight Pakistan Stock Exchange closed almost flat during the week ended on 16th July 2021 at 47,834 points, up 0.6%WoW. The investors preferred to remain on sidelines eyeing Eidul Azha holidays. Average daily trading volumes contracted 4.0%WoW to 467 million shares. Major activity continued to be in the main boards items. Similar muted performance was recorded across all sectors with exceptions being Modarabas (up 57.3%WoW), and Textile Weaving (up 9.1%WoW). Major news flows of the week included: 1) LUCK locking-in contract for setting-up plant for manufacturing of Samsung mobiles in Pakistan, 2) Covid positivity…

Read More

Engro story began in 1957 when Pak Stanvac – an Esso/Mobil joint venture – stumbled upon vast deposits of natural gas in Mari while pursuing viable oil exploration in Sindh. Pak Stanvac’s focus was exclusively on oil exploration; however, the discovery shifted the impetus to Esso, which decided to invest in the massive industrial potential of Mari gas field. Esso proposed the establishment of a giant urea plant in Daharki, about ten miles from the Mari gas fields, which would use natural gas produced as its primary raw material to churn out urea fertilizer. Talks with the Government of Pakistan…

Read More

Ismail Iqbal Securities (Pvt) Limited (IISPL), with its inception in the year 2004, became a Corporate Member of the Karachi Stock Exchange. IISPL is presently a TREC holder of the Pakistan Stock Exchange, as well as an SECP registered Underwriter and Book Runner. IISPL also holds BMR3 in Broker Management Rating and A(-) in Entity Rating given by PACRA. The Company is committed to providing a comprehensive range of products and services to its clients by offering a combination of quality products and bundles of sophisticated financial services and investment opportunities for its individual as well as corporate clients. IISPL…

Read More

Upcoming results a welcome boost for investors Weak sentiment coupled with geopolitical tensions in the region and uncertainty over talks with IMF continued to dampen investors’ confidence. Thursday session which saw massive buying by Mutual Funds, to the tune of US$12.7 million, helped the benchmark index to break the losing streak. However, the index could not sustain that level and closed in red in the following session by cumulatively losing 123 points (down 0.26%WoW) to close the week at 47,563 points. The withdrawal of US troops from Afghanistan is creating a vacuum in a high foreign stake region. Added to…

Read More

The Federal Budget strategy for FY22 is stated to be pro-growth and spending-led. The total size of the outlay is Rs8.5 trillion which is almost 19% higher as compared to the outgoing year’s budgeted expenditure of Rs7.1 trillion. The increased spending is expected to boost economic activity through total development expenditure of Rs964 billion, which is up 22% from previous year’s budget. The GDP growth target for FY22 has been set at 4.8% which is viable given the estimated growth rate of 3.94% for the outgoing fiscal year. Since primary balance posted a surplus of Rs159 billion during 10MFY21, debt…

Read More

Federal Budget FY22, prioritize a mix of growth and stabilization, targets GDP growth at 5.0% with tax collection at PkR5.83 trillion. Also aims at limit FY22 budget deficit to 6.3% of GDP. Incentivizing value added sector and reducing duties may prove a winner for all. GoP’s structural reforms for curing economic ills are quite visible with Refinery policy provisions and Energy sector reforms coming to the forefront. At the same time, reduction in Capital Gains Tax (CGT) for filers to 12.5% from 15% is likely to cheer the development in the coming days. Despite continued strong earnings momentum (3QFY21 earnings…

Read More

Index remains range bound amid uneasiness ahead The benchmark index of Pakistan Stock Exchange (PSX) remained range bound during the week ended on 25th June 2021. The investors remained jittery regarding the FATF Plenary meeting which took place from 21st to 25th of this month. Added to this, was uneasiness regarding the ongoing talks with the IMF. The week closed at 47,603 points, down 1.3%WoW. Automobile Assemblers turned out to be among the outperformers, increasing by 0.28%WoW, led by PSMC as the stock rallied in anticipation of tax incentives offered to cars under 850cc being extended to cars under 1000cc…

Read More

‘Female Dump Truck Driver Program’ launched in 2017 has received an overwhelming response from the women living in the impoverished area Every progressive nation ensures the inclusion of women in its socio-economic mainstream, because the world cannot have a sustainable future, if this half of its population is not skilled enough to play a productive role in the community. Ideally, women are educated and qualified to earn a healthy income, while the society provides them opportunities to contribute positively. Since, gender-diversity promises optimum utilization of human-resources in a society, the corporate sector also supports female-literacy to engage them in professional…

Read More

Budget related news keep investors at bay After an exuberant week, Pakistan Stock Exchange (PSX) started the week with same enthusiasm. However, the benchmark index failed to sustain that level as investors started booking their gains in later sessions. The market closed on 4th June 2021 at 48,212 points, up 2.3%WoW. The average weekly trading volume in KSE-100 declined to 1.12 billion shares, down 9.4%WoW. The overall investors’ sentiments remained positive on account of improving macroeconomic indicators where government’s continued support to construction sector resulted in engineering sector being among the leaders with a performance during the week. Meanwhile, refinery…

Read More

In the second half of 2020, Americans, trapped at home by the pandemic, started buying weighted blankets, Crocs, giant fleece hoodies, ring lights and desks at a relentless pace. One toilet paper manufacturer saw a 600% increase in sales over two weeks. Another retailer sold out of a year’s stock of bird feeders in two months. Yoga leggings, milk frothers, air fryers and lawn mowers were crammed into shipping containers in the ports of Asia. Earlier that year, at the start of the pandemic, idled ships could be seen anchored off the Singapore coast, eerie and still. But by the…

Read More

Index moves strongly; upcoming mps, budget in the limelight Carrying the momentum from last week, the market started the week ended on 28th May 2021 on an exuberant note on the back of strong economic growth data and the news related to populous budget proposals. The market remained in the green, gaining 1,211 points. Benchmark index closed at 47,126 levels, up 2.64%WoW. The market witnessed a surge in trading volumes as highest intraday volumes were witnessed on Thursday with an exchange of 2,220 million shares (up by 42%) over the previous day highest intra-day volume. Apart from this, the weekly…

Read More

With the growing influx of remittances, now touching US$2.5 billion per month and COVID-19 still hindering movement of people, there is a need to further improve delivery system. One of the reasons people has been using Hawala or Hundi system was speedy delivery of money at the homes of recipients, particularly in the rural areas. The COVID-19 pandemic has placed unprecedented restrictions on travel, trade, and economic activity, triggering a global economic crisis. As a result, remittances to developing countries were expected to fall sharply. Families of the overseas workers, many solely dependent on the remittance flows sent from abroad,…

Read More

Interview with Mr Arif Nadeem – CEO, Pakistan Agriculture Coalition [box type=”shadow” align=”” class=”” width=””]Arif Nadeem has over 35 years experience in the public sector and is an expert in public policy and administration. Prior to joining Pakistan Agricultural Coalition (PAC) he served as Secretary to the Government of Punjab in the departments of Agriculture, Irrigation and Health. He is known to be an authority on the procedural functioning of federal, provincial and local governments and holds extensive knowledge of Pakistani laws, rules and regulations. He has worked closely with various UN Agencies and international aid organizations (World Bank, ADB,…

Read More

Profit-taking witnessed; political, covid fear persist After starting the week on a jubilant note on the back of strong economic data, market lost 1,420 points during last four sessions as political uncertainty mounted with a spat among ruling party’s members. Added to this were increased incidences of COVID-19, supporting a possible lockdown in highly affected areas. Resultantly, KSE-100 Index closed the week at 44,262 points, down 0.99%. Across the board profit-taking was witnessed where engineering sector, despite posting impressive results, remained under pressure, going down by 6.7% during the week. Participation remained low with average daily turnover decreasing to 332…

Read More

State Bank of Pakistan (SBP) has unveiled the third five-year Strategic Plan for the development of Islamic Banking in the country. The plan has set headline targets for Islamic banking to be achieved by 2025. These include: 1) achieving 30% share in both assets and deposits of overall banking, 2) boosting to 35% share in branch network of overall banking, and 3) acquiring 10% and 8% share of SMEs and agriculture financing respectively, in private sector financing by Islamic banking. In order to steer the growth of Islamic banking on sound footings, SBP has been providing proactive guidance through issuance…

Read More

Lockdown fear, declining bond yields may weaken sentiments Bond yields in the secondary market of Pakistan came down by 5-12 bps, while compared to 11th March 2021 have come down by 12-65 bps. Analysts believe the decline in yields is largely due to rising COVID-19 cases in the country, which may potentially delay any rate increase by State Bank of Pakistan (SBP). The appointment of Shaukat Tarin as new Finance Minister has also added to this belief, as he has been vocal of low interest rates prior to his appointment. Asad Umar, Minister for Planning, Development and Special Initiatives said…

Read More

Interview with Arsalan Hashmani – CEO, Hasmanis Hospitals [box type=”shadow” align=”” class=”” width=””]Profile: Mr. Arsalan Hashmani is one of the distinguished entrepreneurs in Pakistan, CEO of Hashmanis Group of Hospitals and Vice President of Hashmanis Medical Welfare Foundation (HMWF). Aside from this Mr. Hashmani is also the Vice Chairman of World Memon Organisation – Global Youth Wing – Pakistan Chapter. He graduated in Accounting and Financial Management from the University of Waterloo, Canada. He acquired master’s degree in Accounting and is a certified Financial Analyst (CFA). With respect to time he gained a considerable experience as he worked with numerous reputable…

Read More

Index springs back; result season, tax measures for budget will likely define sentiments The week ended on 9th April 2021 remained volatile due to the concerns on rising COVID cases in the country. Market was down more than 750 points on the first day of the week. However, a sharp recovery in the remaining days helped the market to close at 45,186 points, up 2.0%WoW. Stronger growth forecasts by IMF, and lower than expected inflation reading in March 2021 acted as catalysts to change investors’ sentiments followed by US$2.5 billion inflows from Eurobond. Other news flows during the week included:…

Read More

The rally over the past 12 months or so in the equity markets worldwide have largely been fueled by an increase in liquidity. Governments and in some instances central banks have poured in greater liquidity to stimulate economies in the midst of COVID-19 outbreak, which remains mantra of policymakers over the months. According to a report by Topline Securities, it remains difficult to gauge/quantify by how much has the liquidity increased in a country like Pakistan due to significant presence of an undocumented economy. That brokerage house believes changes in M2 may provide a good proxy for an analysis. M2…

Read More

At its meeting on 19th March 2021, the Monetary Policy Committee (MPC) of State Bank of Pakistan (SBP) decided to maintain the policy rate unchanged at 7 percent. The MPC noted that since the last meeting in January 2021, growth and employment have continued to recover and business sentiments have further improved. Looking further ahead, this year’s upcoming round of wage negotiations, next year’s budget, and the path of domestic energy prices and international commodity prices may have an important bearing on the inflation trajectory. The MPC will monitor these developments carefully and react to them appropriately when needed. While…

Read More

PSE index ends on strong note and likely to be build up Pakistan Stock Exchange (PSX) started the week ended on 19th March 2021 on a strong note, after the announcement of Senate election results on the last trading session of the earlier week, rallying 2.23% on the first trading session. During the following trading sessions benchmark index remained volatile, where bullish sentiment from political victory of incumbent government was given a tough face-off by corporate income tax exemption withdrawals and potential inflationary pressures from electricity rate hikes — both necessary to unlock third tranche of IMF’s EFF facility (payment…

Read More

Accelerated by the pandemic, the digital future is coming at us faster than ever before, and maybe faster than we can imagine. There is a need to explore the possible consequences—the good, the bad, and the gray. For millions, technology has been a lifeline, changing the way people work, learn, shop, and entertain themselves. In a year like no other, it has spurred game-changing digital shifts. Governments moved quickly, using mobile solutions to provide cash assistance; financial technology has helped the survival, and in some cases, growth of small- and medium-sized businesses; and the first national digital currency, in The…

Read More

Market stays dull but likely support for govt come positive The benchmark index of Pakistan Stock Exchange closed the week ended on 5th March 2021 at 45,837 points, almost flat. The week was marked by extreme volatility on the back of political drama surrounding Senate elections. The market registered major uptick in initial half of the week owing to anticipations regarding the elections. However, the index went downhill following the news of PTI’s Minister for Finance and Revenue, Dr. Hafeez Sheikh being unsuccessful in his bid to become a senator from Islamabad, losing to the former prime minister Yousuf Raza…

Read More