PakStox Outlook

HBL announced Financial Results for the Year Ending 31 Dec 2022. Cash Dividend: Rs. 1.5 per share. This is in addition to Rs. 5.25 already paid. Making a total of Rs. 6.75/share for the whole year. EPS (Year 2022) Rs. 23.23 (last year Rs. 23.88). Profit after Tax (Year 2022): Rs. 34.4 billion, down 3% over last year of PAT of Rs. 35.5 billion. Profit before tax had increased over 24% but higher income tax at 55% ( last year 43%) impacted the bottom line negatively. HBL Net Interest Income had also boosted by 26%. In addition 269% increase in 'Foreign Exchange Income' (Int) was nullified by higher income tax rate.

Fauji Cement:  On its way to become the third largest cement company. Has 3 plant locations. The recent addition of 2mn tons at Nizampur has taken the capacity to 8.4mn tons. Planned expansion at Dera Ghazi Khan of 2mn tons, is expected to commence operations by CY23 end. CapEx is estimated at Rs38bn financed with a Debt: Rs23bn & Equity: Rs15bn. Major portion with debt under TERF and LTFF arrangements. FCCL could only manage to secure Rs4bn under TERF and it will now not be able to avail LTFF rates for the upcoming expansion. This will have an impact of Rs800mn.  40% of the equipment import is remaining. FCCL fuel mix for 1HFY23: Afghan coal being 44% ,local coal  at 52-53% in the coal mix. Afghan coal prices are  around Rs52-55k/ton, while local coal is at Rs33-35k/ton. Landed cost for imported coal comes to around Rs60-62k/ton. current coal cost ia around Rs42-43k/ton compared to around Rs 38k/ton in 2QFY23. More at:  FCCL - Stock quote Pakistan Stock Ex...

 IMF staff-level pact likely this week:  With the implementation of all major prior actions, Pakistan is eyeing a staff-level agreement with the International Monetary Fund (IMF) this week. Read Fuel cost for power generation rises 59pc:  The rise in the fuel cost was triggered by a decline in hydel- and nuclear-based power generation. Read Cabinet extends duty for 40 days:  According to the cabinet’s August 2022 decision, these higher rates had to come to an end on February 21. Additional customs duty of up to 28% on cars has also been extended till the end of March. Dow closes nearly 700 points lower in broad selloff, as all indexes cap their worst day of 2023:  The benchmark 10-year Treasury yield climbed to 3.9%, while the 2-year rate advanced to 4.7%. Read "The VIX is still a touch below 23 even with today’s market meltdown.  It needs to hit 35, as it did last Fall during the S&P 500 lows, before the complacency is fully wrung out." tweet Indian ru...

Two important developments that took place this week, shaping the economic and political landscape of Pakistan, have come after a long legal process, but will not be noteworthy for their legal standing. One was the disqualification of Imran Khan by the Election Commission of Pakistan, and the other, the exclusion of Pakistan from the ‘gray list’ by the FATF. Although ample legal grounds were available, legality on such matters is just a useful tool. Both of these decisions were rooted in politics, local as well as international. Therefore, the implication of such decisions should be assessed based on their political angle rather than legal. What is important in the disqualification verdict of ECP, is the recommendation for initiating a criminal proceeding for ‘acts of corruption’ by the Ex-Prime Minister, Imran Khan. This is important in the respect that even if the disqualification is reversed in a court appeal, or becomes ineffective through legislation, the criminal proceeding based...

Oil extends gains after Opec+ agrees to slash crude output.   Read news Opec+ agreed to further tighten global crude supply with a deal to slash production by about two million barrel per day, the largest reduction since 2020. Given that production at some of the Opec+ countries are below target levels, the actual cut would be smaller than the two million bpd reduction. More than half of the one million bpd supply cut is expected to come from the world’s top exporter Saudi Arabia,  A draw in US SPR  last week also supported prices. Crude inventories dropped by 1.4m barrels in the week ended Sept 30 to 429.2m barrels (EIA). Brent trading at $93.3 and WTI at $87.6. See OPEC production caps. Twt . Gold has risen close to 7% after touching a low of $1615 last week. see

"Dow soars 800 points as stocks extend massive rally on fresh hopes for less hawkish central banks".  Read "Employment data added to optimism that the tightening cycle may come to a close sooner than previously thought. Job openings in August plunged by 1.1 million in a possible sign that a slowing labor market will ease inflationary pressure." "Stocks soar, yields slide on hints of cooling economy".  Reuters "U.S. stocks and oil on Tuesday posted strong gains for a second straight day while U.S. Treasury yields slid as investors wondered if global efforts by central banks to fight inflation may ease in the future." A soaring US dollar will force the Fed to pivot away from its interest rate hikes :  Business Insider "It appears increasingly likely that the Federal Reserve will pivot away from its currently hawkish monetary policy as global US dollar liquidity is now in the "danger zone where bad stuff happens," Morgan Stanley's...

 Dow Jones Year to Date Components Retunes: Dow Jones Year to Date Performance (slickcharts.com)