CAPITAL MARKETS

 

1- FOREX KERB WATCH

2- COT WEEKLY REVIEW

3- FINEX WEEK

4. STOCK WATCH
5. STOCK MARKET AT A GLANCE


STOCK MARKET AT A GLANCE


By SHABBIR H. KAZMI
Updated Apr 02, 2005

 

 

MARKET THIS WEEK

This week KSE-100 index remained under pressure, owing to the future contract settlement issue. On Monday, market continued its bearish spell and declined by another 255 points. Financial institutions assurance to provide fund for settlement of futures contract also failed to change the bearish trend. However, on Tuesday market staged a healthy recovery after a consortium of institutions agreed to buy substantial quantity of OGDC shares @PkR117.50 per share. This announcement pulled the other scrip's to recover.

On Wednesday, investors availed the opportunity to buy stocks which had come down to attractive levels which has helped the index to move up. On Thursday, the market could not sustain its brief bullish spell and collapsed over rumors of changes in future contract rules and remained under pressure on Friday. In sum KSE-100 index lost 368 points over last week.

Outlook for the Future

In our opinion, the market will remain range bound next week. OGDCL would continue to exert pressure on the index. We advise our client to keep limited exposure and trade only on a strict stop loss basis. However, individual stock valuations have become attractive. Our top picks for next week are HUBCO, FFC, and SNGPL.

FUNDAMENTAL CHANGES

The major developments this week were:

•The State Bank of Pakistan (SBP) rejected all bids for PIB auction held on Mar-26.

•The continuous fall in stock market and the pressure to settle their long-term positions is reportedly forcing investors to liquidate their real estate holdings.

•The government is likely to delay complete handover of Karachi Electric Supply Corporation (KESC) to Kanooz group of Saudi Arabia.

 

 

•As a result of winter rain received, Pakistan is expected to have a massive 121.9 million-acre feet (MAF) of water at its disposal in the forth-coming Kharif crop season

•ADB offers Political risk guarantee to foreign investors.

•Kalabagh Dam not included in 5-year Water sector Plans.

•China Mobile Expresses interest in PTCL.

•Al Kanooz seeks government guarantees for KESC.

•Engro seeking gas allocation for 50k tons Expansion.

•State Bank of Pakistan (SBP) to increase the benchmark 6-M T-bill yield by 48bps to 5.69%.

•SSGC seeks PkR10/unit increase in tariffs.

•India resolute on gas pipeline issue.

•CBR raises PkR2.16bn through CVT & withholding tax.

•International oil keeps up phenomenal surge.

•Domestic oil prices remain unchanged.

•CBR surpassed its first 9-M revenue target, tariff liberalization and revenue collection

•Pakistan's revenue collection has been impressive and broad based in first 9-M of current fiscal year, owing to the trade liberalization reforms taken place in the last budget.

•Looking ahead, the growth in revenue collection is likely to continue. As the domestic demand is peaking, owing to the sound GDP growth of 7.2-7.4% expected in FY05.

•Sustained growth in revenue collection should encourage (1) GoP to further liberalize the duty structure in FY06 budget (2) to increase PSDP in years to follow.

 

 

TAX REVENUES — BROAD-BASED COLLECTION

Despite the broad based reduction in tariff structure. We believe that the revenue collection in the first 9-M