PakStox Outlook

Brent crude futures fell 2.9% to settle at $82.63 on Friday, and marked the second consecutive weekly loss, down 2.8%. A stronger dollar and concerns about China's economic outlook applied downward pressure on prices, countering the effects of tighter supply. The dollar's value increased after unexpectedly strong U.S. labor market and manufacturing data earlier in the week, reducing demand for dollar-denominated oil from buyers using other currencies. Additionally, recent data indicated that China's economy grew by a slower-than-expected 4.7% in Q2, intensifying worries about oil demand from the world's largest importer.

The KSE100 Index made a significant decline of 1,722 points (-2.1%) and closed at 80,118. Some political comments and Fitch's remarks on the possibility of an interim change sparked the decline. Even as the market declined, there was a good amount of net buying by foreign corporates, around $1.4 million. Strangely, today overseas investors made a massive net buying of over $3.7 million. My sense is that this sudden burst of activity by overseas Pakistanis is on account of local owners routing their acquisitions through foreign accounts. Also noteworthy is the net buying by local mutual funds, amounting to $2.2 million. The decline in the market is probably due to massive net sales by insurance companies, who sold close to $10 million worth today. DG Khan Cement to establish a subsidiary in the US to be named DG Cement US LLC. Read More PTC announced second quarter results for the period ending 30 Jun 2024. Earning per share came at Rs 0.14 compared to Rs. 0.3 same period last yea...

On IMF deal the KSE100 Index rises 1251 points closing at  81,155 up 1.52% Good amount of net buying by Foreign Corporates of around $3 million. Local mutual funds were also net buyers of close to $1 million bucking their recent trend. The sharp upward trend may put a stop at redemption pressure on the local funds. The recent persistent trend of higher inflation and higher oil prices is dampening hopes of further rate cuts. Otherwise, the absence of selling pressure at the Pakistan Stock Exchange (PSX) was enough to sustain the bullish trend.

Pakistan: IMF Reaches Staff-Level Agreement The Pakistani authorities and the IMF have reached a staff-level agreement on a 37-month Extended Fund Arrangement (EFF) worth approximately US$7 billion, pending approval by the IMF's Executive Board and confirmation of necessary financing from Pakistan’s development and bilateral partners. (12 July 2024) The program aims to build on last year's macroeconomic stability by strengthening public finances, reducing inflation, rebuilding external buffers, and removing economic distortions to encourage private sector growth. Key policy goals include: Sustainable Public Finances: Gradual fiscal consolidation through tax reforms and increased resources for development and social spending. FY25 budget aims for a 1% GDP primary surplus, supported by fairer taxation and expanded social protection. Federal-Provincial Fiscal Balance: A National Fiscal Pact reallocates spending responsibilities, enhancing provincial tax efforts, including harmoniz...

12 Jul 2024: The KSE100 again failed to maintain the 80k level, which it had gained by reaching an intraday high of 83,322. It closed the day by losing 48 points, ending at 79,944. The key event today was the market's reaction to the Supreme Court's decision to restore some seats to the PTI in a judgment announced today. Upon the announcement, which was seen as weakening the incumbent government, the market tanked over 1,200 points. However, the recovery was quick, establishing the bullish trend in the market. Today again local mutual funds were net sellers of over $1.4 million. There was no significant activity by the Foreign investors today.  This week, the market remained under selling pressure primarily from mutual funds and lost approximately 269 points for the week. Major Gainers/Losers Today: Indus Motor Com (PSX: INDU) is temporarily halting production at its plant from July 15th to 22nd, 2024 due to a shortage of vehicle parts and low inventory caused by supply chain c...

11 July 2024: The KSE100 index made an intraday high of 80114, but gave up some of those gains to close at 79,992, still up 151 points for the day. Trading in general remained subdued. Foreign Corporates were net buyers today of $1.4 million. Foreign Investors so far have not turned into major sellers at PSX. Local Mutual Funds again net seller today of a big amount of $0.98 million. Banks/DFI were also net sellers.  Since first of this month mutual funds have made a net sale of over $14.7 million. Following are the major Gainers/Losers of the day; The market is adjusting to the post-budget scenario. A strong upward movement, driven by pre-emptive buying before the new capital gains tax regime took effect on June 30th, has overshadowed the negative assessment of the future economic course following the federal budget announcement.   The increase in petroleum prices and elevated exchange rates, coupled with a strained public finances situation, are choking the economy. It ...

10 July 2024: KSE100 Index broke 80K level and closed at 79,842 ▼ 831 points. Good amount of net buying by ‘Foreign Corporates’ of over $ 1.9 million. The market was pressured by local mutual funds selling. Today they made a net selling of over $ 1.6 million after two days of respite. Read More Saudi Arabia warned to sell European bonds if Russian frozen assets are seized. S&P and Nasdaq Continue to Top Records WTI crude oil futures edged up toward $82 per barrel on Wednesday after the EIA reported a larger-than-expected decline in US crude stockpiles.