PSX: Bulls invade the Karachi bourse

KARACHI: KSE-100 Index closed in the green (40,916.69) with an augmentation of 402.42 points on the last trading day of the week.

The news that Russian Federation had been offered by Pakistan to participate in the divestment of government’s shareholding in OGDC and PPL – and become a strategic partner by acquiring shares had augmented the confidence of investors.

While buying activity was also seen in banking, oil and gas marketing companies, among the slow were autos, cement and steel were generally among the laggards.

Major entities contributing 30% of total turnover were Unity Foods, Bank of Punjab, Fauji Foods, Avan­ceon and OGDC.

Rally was led by PPL augmenting by 5pc, OGDC 4.1pc, Habib Bank 1.34pc, PSO 2.88pc, Sui Northern Gas Pipelines 4.25pc, Nishat Mills 5pc, UBL  0.77pc, Dawood Hercules 1.16pc, Lucky Cement 0.93pc and ICI Pakistan 5pc.

PSX: Moody’s report lets bulls invade the bourse

KARACHI: KSE-100 Index closed in the green on the second last trading day of the week here today at 40,641 gaining 370 points.

Savants maintain investors gained confidence following another +ve report from Moody’s Investors Service, which upgraded the outlook on five Pakistani banks (ABL, MCB, NBP, HBL and UBL). The news about augmentation of cement sales also helped investors confidence and buying interest remained strong in cement as well as banking.  Cement sales in November 2019 rose 11% year-on-year to 4.35 million tons.

Positive close was aided by PPL (+3%), Pakistan Oilfields (+2.2%), HBL (+1.7%), UBL (+0.3%), Lucky Cement (+1.8%) and DG Khan Cement (+4%). 507.9 million shares worth Rs. 20.1 billion changed hands today. Shares of 404 entities were traded today. Value of the stocks of 226 companies augmented, 159 plummeted while 19 remained stagnant.

Volume leader that gained Rs. 0.08 was Unity Foods traded 35.2 million shares. Runner-up was Fauji Cement with 34.1 million shares,closing at Rs.17.07. Maple Leaf Cement closed at Rs. 24.12. Foreign institutional investors were net buyers of Rs/ 225.5 million worth of shares.

WASHINGTON: Taking to the Twitter today United States Principal Deputy Assistant Secretary for South and Central Asian Affairs Alice Wells welcomed the improvement in Pakistan’s outlook by credit rating agency Moody’s.

Alice Wells

In the tweet issued on behalf of Wells by the US State Department she maintained: Pleased to see that Moody’s has revised Pakistan’s credit outlook to stable thanks to Fin Ministry Pakistan’s reform efforts and IMF program. With bold economic reforms, Pakistan can boost growth, attract private capital, and expand exports. AGW”

Earlier Advisor to PM on Finance Dr. Abdul Hafeez Shaikh took to the Twitter to inform that Pakistan’s outlook has been upgraded by Moody’s Investors Services from -ve to stable.

MoodysIt is pertinent to mention here that (citing heightened external vulnerability risk due to depleting foreign exchange reserves) Pakistan’s ratings outlook was downgraded by Moody’s in the month of June, 2018.

Moody’s maintained: “The change in outlook to stable is driven by Moody’s expectations that the balance of payments dynamics will continue to improve, supported by policy adjustments and currency flexibility. Such developments reduce external vulnerability risks, although foreign exchange reserve buffers remain low and will take time to rebuild 

“Moreover, while fiscal strength has weakened with higher debt levels largely as a result of currency depreciation, ongoing fiscal reforms, including through the country’s International Monetary Fund (IMF) program, will mitigate risks related to debt sustainability and government liquidity.

“The rating affirmation reflects Pakistan’s relatively large economy and robust long-term growth potential, coupled with ongoing institutional enhancements that raise policy credibility and effectiveness, albeit from a low starting point.

“These credit strengths are balanced against structural constraints to economic and export competitiveness, the government’s low revenue generation capacity that weakens debt affordability, fiscal strength that will remain weak over the foreseeable future, as well as political and still-material external vulnerability risks,” Moody’s held in a statement.

Finance Ministry, while commenting on the upgradation, maintained:  “The upgradation of outlook to stable is an affirmation of the government’s success in handling the country’s economy. The government remains fully committed to its reform agenda, which is producing the outcomes that will lay a firm foundation for accelerated, sustainable and inclusive growth in the future.”

Ministry further maintained that the B3 ratings by Moody’s reflected Pakistan’s relatively large economy and robust long-term growth potential, coupled with ongoing institutional enhancements that raise policy credibility and effectiveness.

News Pakistan

M M Alam

M. M. Alam is a Pakistan-based working journalist since 1981. Karachi University faculty gold medalist Alam began his career four decades ago by writing for Dawn, Pakistan’s highest circulating English daily. He has worked for region’s leading publications, global aviation periodicals including Rotors (of USA) and vetted New York Times as permanent employee of daily Express Tribune. Alam regularly covers international aviation and defense-related events including Salon Du Bourget (France), Farnborough (United Kingdom), Dubai (UAE). Alam has reported thousands of events and interviewed hundreds of people in Pakistan, UAE, EU, UK and USA. Being Francophone Alam also coordinates with a number of French publications.