· Local bourse sustained its lackluster performance during the week as uncertainty from the possible verdict on Panama case persisted while volumes remained thin owing to absence of leverage product. Resultantly, broader index shed an additional 266pts (0.6%WoW) during the outgoing week to close at _pts.
· Investors continued cherry picking approach with UBL (+3.2%), LUCK (+3.5%), OGDC (+2.6%), PPL (+2.7%) and NESTLE (+4.2%WoW) cumulatively contributing 266pts to the index. While NBP (-10.3%), ENGRO (-3.6%), MCB (-3.1%), FFC (-3.0%) and, HBL (-0.9%WoW) dragged index by 273pts.
· NBP declined significantly (-10.3%WoW) during the outgoing week after Elixir Securities research report highlighted concerns on possible dent to the bottom-line over pension obligations which is already under litigation phase. However, SSGC gained 7.2%WoW as the company announced hefty investment plan of PKR ~65bn on 1.2BCF capacity pipeline for transportation of RLNG.
· Average trading volume declined significantly by 37%WoW to 156mn shares as compared to 248mn in the previous week, while retail favorites (ASL, ANL, BOP, BYCO and TRG) dominated the volume charts accounting for 29% of the overall volumes.
· Foreigners turned net buyers in the outgoing week, mopping up USD9.25mn worth of shares against net sell of USD19mn in the preceding week. Whereas, Banks & DFIs remained net sellers, selling USD 16.8mn worth of shares..
Key news this week
· Thermal coal prices rise on export disruption in Australia.
· Planning ministry seeks Rs1,000bln as PSDP allocation for 2017/18.
· ECC allows more sugar export despite price rise.
· Fiscal deficit widens as IMF warns of challenges ahead.
· Cement sales climb to 30.3m tonnes
This week’s top stories
· Pakistan Equity Market- March 2017 - A Another Dull Month.
· National Bank of Pakistan- Red Flag Casts Shadow; Placed Under Review.
· Mari Petroleum Company Limited- Exploring New Horizons
Equity Market Outlook
We expect local bourse to continue to depict flattish trend in the upcoming week where any clarity on Panama case verdict has the potential to entice investors to take fresh position.
Closing Note-stock Market "Benchmark Index Remains Flat"
10 April 2017
Benchmark Index Remains Flat
KSE-100 index ended on flat note, touching its intra-day high-low range of 49,147.32 to 48,961.06 points and managed to closed at 49,016.79 points.
Volume traded during the day rise massively to 317mn share (up by 40.8% DoD). Value of shares traded during the day clocked in at PKR 13.3bn as against the last day traded value of PKR 11.2bn.
Out of 386 active scrips, 206 advanced, 166 declined and 14 remained unchanged.
AVN continued its upward trend (gained by PKR 2.57) primarily due to its announcement positive results coupled with cash dividend of PKR 1/share and bonus share of 25 for every 100 shares.
PNSC witnessed a gain of PKR 6.72/share owning to issuance of License for first ferry service between Karachi and Port Qasim.
Banking sector emerged as the top traded sector with turnover of 56.4mn shares followed by Power (52.4mn),Cement (27.9mn), Engineering (27.7mn) and Textile (27.4mn).
News & Corporate Announcements:
East West Insurance Co., Ltd declared its financial results for the CY16. EPS of the company clocked in at PKR 5.55 up by 115%, as compared to last year EPS of PKR 2.58.
HBL notified PSX regarding its agreement with Diamond Trust Bank Kenya to transfer HBL’s Kenya branch assets and liabilities in return for which HBL will receive additional 13,281,105 shares in DTBK thereby taking its total shareholding to 16.15% from 11.97%.
The Department of Homeland Security will require passengers coming to the United States from airports in Jordan, Egypt, Turkey, Saudi Arabia, United Arab Emirates, Kuwait, Morocco and Qatar to check electronic devices larger than a cell phone such as tablets, portable DVD players, laptops and cameras. The airports affected are in Amman, Cairo, Kuwait City, Doha, Dubai, Istanbul, Abu Dhabi, Casablanca, Morocco; Riyadh and Jeddah, Saudi Arabia.
Clueless is what we are in the current market scenario as the most important thing that investors look for is lucidity. With the lingering panama verdict, the Index is unable to find its direction. The KSE-100 Index has remained flattish CYTD, under-performing regional markets, with deteriorating security situation, rising BOP concerns, political uncertainty and SECP crackdown on local brokers to blame for.
The KSE100 index managed to close positive +0.11% today and settled at 47,942.95 level once again on thin volumes (>50mn). Market participation for the 100 Index declined by 12.3% on d/d basis, clocking in 49.08mn shares. Major contribution to total market participation came from ANL (+2.92%), DCL (-0.45%) and TRG (+0.53%), which contributed 35.43mn shares out of 130.7mn to total traded volume today. Daily Traded Value for the 100 Index increased to USD 53.39mn from USD 44.78mn on Friday (+19.20% on d/d basis). ATRL (USD 8.67mn), PAEL (USD 6.30mn) and TRG (USD 4.15mn) were among top contributors from value perspective. Major contribution to upside came from HBL (+1.02%), OGDC (+1.54%), UBL (+1.25%), ABOT (+3.07%) and PAEL (+2.22%) adding 114pts. On the flip side, EFUG (-2.35%), PMPK (-4.98%) and FCCL (-1.21%) took away 24pts. From sector perspective, Health Care (+0.67%), Energy (+0.57%) and Industrials (+0.57%) contributed towards a strong close.
Glaxo SmithKline Healthcare Pakistan Ltd (GSKCH) continues its relentless ride without hitting a single volume in the regular market besides crazy off-market transactions so far highest traded price stands at PkR. 175/shs.
Technically speaking, the KSE-100 Index formed a Doji amid thin participation showing signs of indecisiveness. 10EMA (48,022) and 10WEMA (48, 402) may continue to pose resistance for now. On the flip side, 20WEMA (47, 452) may provide support for now.
KSE-100 Index 47,943, High 48,096, Low 47,732, Change +54, Value USD53mn ,Volume 49mn
Pakistan Equities closed marginally upwards on first day of the new week after stocks witnessed volatile trading and benchmark KSE100 Index pared most of the day's gains after testing highs near 48,100 level. Start to the day was on dreary note as wider market failed to carry momentum from late Friday's trading and slipped in the red zone on low turnover. Later, recovery was seen as gains in select Index names across Financials and E&Ps helped Index to recover lost ground however profit-taking in the final hour again dragged Index in the red zone. Major contribution to day's gains came by Habib Bank HBL PA +1.0%, Oil & Gas OGDC PA +1.5% and United Bank UBL PA +1.3% while Fauji Cement FCCL PA -1.5% was among the top three stocks that dented KSE100 Index on relatively dull volumes. Meanwhile, retail favourite Pak Electron PAEL PA +2.2% closed in green after announcing earnings that came in line with Elixir's estimates.
Seeing volatility to persist as investors continue to await clarity on Panama case, however earnings excitement as the results season gets into full swing in the coming days will likely bring investor's focus back on fundamentals and may also help marginalize concerns over domestic politics.
IMS Day Wrap – Relinquishing the Index
11 April 2017
For the time being investors have relinquished the market as all eyes are focused on the Panama case verdict while obviously hoping for the best but nevertheless the fear of the unknown persists. Recent under-performance has contributed towards keeping the overall sentiment in check with market participants waiting for the outcome of Panama case and the launch of refurbished Margin Financing product. Moreover, Justice Ejaz Afzal Khan, a Supreme Court judge, observed today that the apex court’s verdict in the Panama case will set a precedent which will be remembered for centuries. Meanwhile, Columbia University has announced that the Panama Papers investigation has been awarded the Pulitzer Prize for using a collaboration of more than 300 reporters on six continents to expose the hidden infrastructure and global scale of offshore tax havens.
At home, a relief rally is in vogue perhaps because expected negative news is not materializing as yet, or maybe it’s not as severe as originally anticipated. Nonetheless, surge in crude oil prices is definitely supporting the Oil & Gas sector with E&P companies and OMCs at the helm of the vanguard. Cements are taking center stage amid robust local dispatches followed by Banks, Pharmaceuticals and select Autos recouping their earlier losses. In separate news related to changing landscape for asset management companies (AMC), AKBL (-0.4%) has announced that it has entered into a share purchase agreement with Pak Oman AMC, subject to obtaining of requisite regulatory approvals. Towards the end, the 100 Index closed up 307.12pts (+0.64%) at 48,250.07 amid thin market participation.
Market participation for the 100 Index witnessed a minor increase by 2.14% on d/d basis, clocking in at 50.13mn shares. Major contribution to total market participation by ANL (-1.61%), DCL (+4.48%) and TRG (+4.98%) trading 41.79mn shares out of the total volumes of 146.97mn. Daily Traded Value for the 100 Index witnessed a minor decline to USD 50.13mn in today’s session from USD 53.39mn yesterday (-6.09% on d/d basis). TRG (USD 6.18mn), ATRL (USD 5.67mn) and DCL (USD 3.03mn) were among top contributors from value perspective. Major contribution to upside came from HBL (+2.24%), POL (+3.03%), TRG (+4.98%), SEARL (+2.03%) and KTML (+3.45%) adding 161pts. On the flip side, FFC (-1.16%), PAKT (-3.42%) and HUBC (-0.42%) took away 36pts. From sector perspective, Industrials (+1.29%), Consumer Discretionary (+1.19%) and Health Care (+1.14%) contributed towards a buoyant close.
Technically speaking, the KSE-100 Index extended gains after posting an indecisive close yesterday and closed above 10EMA (48,063) amid declining participation. Next resistance is 10WEMA (48,458) or 50EMA (48,423) for now. On the flip side, 20WEMA (47,481) may provide support for now.
11 April 2017
Closing Note: KSE-100 index recover previous day loss with gain of 307 points
KSE-100 index recover previous day loss with gain of 307 points
Benchmark index recuperated previous trading day loss touching its support-resistance level of 47,870.17-48,257.03 and managed to close with gain of 0.64% DoD at 48,250.07 points owing to surge in international oil prices.
Overall volume transacted during the day reached to146mn shares, up by 12.3% as compared to last day traded turnover of 130mn shares. 377 scrips changed hands in the session today, out of which 220 inclined, 137 declined and 20 remained intact. Traded value during the day remained flat at PKR 7.6bn.
SNGP gained in its value by PKR 1.81 primarily due to approval of ending a moratorium on fresh bulk gas connections to domestic, commercial and industrial consumers. Similarly, POL increased by PKR 13.56 in its value on the back of increase in international oil prices.
Among the stocks, major input to upside came from HBL adding 78.36 points to the index rise, followed by POL (28.77 points), TRG (22.43) points, SEARL (17.18 points), and KTML (15.18 points). Cement sector appeared as the top traded sector with turnover of 22.1mn shares followed by Technology & Communication(16.59mn) Textile (16.30mn) Chemicals (13.66mn) Banks (13.15mn).
News & Corporate AnnouncementsThe first quarterly board meeting of PTC will be held on April 13, 2017 at 12:00 PM.
The first quarterly board meeting of EFOODS will be held on April 13, 2017 at 1:30 PM.
Prime Minister Nawaz Sharif approved ending a moratorium on fresh bulk gas connections to domestic, commercial and industrial consumers and ordered settlement of growing circular debt for smooth running of the energy sector.
The GDP growth rate for 2016-17 will fall short of the target of 5.7%, according to the half-yearly economic review issued by the Institute for Policy Reforms (IPR), an independent think tank.
Exporters have criticized Federal Board of Revenue’s (FBR) decision to roll back all electronically created refund payment orders belonging to five export-oriented sectors. In a joint meeting, the exporters of more than a dozen value-added textile associations expressed concern over the FBR’s move which they said would hurt Pakistan’s already falling exports.