Good Morning

The previous week saw the market carry on with its rising trajectory, gaining grounds for the 11th consecutive session and going past the 36k mark. We believe the recent momentum is largely a product of asset reallocation towards equities by key institutions amidst falling treasury yields.

The economy is also depicting signs of recovery post the partial alleviation of lockdown restrictions evidenced by recovering growth in key sectors. Moreover, exports are also inching towards recovery (+14% MoM) as lockdown eases on a global scale. Overall, we believe investors are placing their bets on the longer horizon in hopes of a sharp recovery.

Market View: The KSE100 ended the earlier week up by 1,139 points, to close at 36,190 points. The market continued to find support from inflows of funds by key institutions likely due to asset reallocation amidst low interest rates. Onwards, we believe the result season will likely influence the index’s momentum as the financial performances would fully reflect the impact of the pandemic.

Commodities:

Brent oil (USD/bbl): 42.81 (-0.99% D/D)

WTI oil (USD/bbl): 40.17 (-1.01% D/D)

Gold (USD/oz): 1,804.74 (0.33% D/D)

National News

Imran unveils construction industry package

Prime Min­ister Imran Khan on Fri­day announced a big incentive package for the const­ruction industry that inclu­des a subsidy of Rs30 billion for the Naya Pakistan Hou­sing Project (NPHP) so that people could build their dream house at an affordable cost.

https://www.dawn.com/news/1568259/imran-unveils-construction-industry-package

Pakistan likely to ease regulatory curbs to boost economy

Prime Minister Imran Khan on Saturday approved, in principle, a set of recommendations to tap the potential of neglected sectors of the economy by lowering regulatory restrictions and digitising the economy.

https://tribune.com.pk/story/2254452/pakistan-likely-to-ease-regulatory-curbs-to-boost-economy

Engro coal power to add 660MW next year

Sindh Engro Coal Mining Company – a joint venture between Engro and the provincial government – planned to double annual coal mining from Thar to 7.6 million tons that are expected to generate additional 660 megawatts till next year, its top official said on Friday.

https://www.thenews.com.pk/print/685167-engro-coal-power-to-add-660mw-next-year?_ga=2.245133893.1530587258.1594608230-2026443033.1524057990

Rising food prices behind inflationary pressures: SBP

Rising food prices were the major driving force behind inflationary pressures as the group’s weighted contribution in the CPI basket jumped to 52.2 per cent in May compared to 37.6pc in the corresponding month of 2019, the State Bank of Pakistan’s (SBP) Inflation Monitor for May showed on Saturday.

https://www.dawn.com/news/1568480/rising-food-prices-behind-inflationary-pressures-sbp

Textile exporters’ liquidity crunch hinders Pakistan’s exports

Textile exporters have expressed immense distress as they are facing severe liquidity crunch due to the imposition of 17% GST as the government has yet to issue refunds.

https://tribune.com.pk/story/2254460/textile-exporters-liquidity-crunch-hinders-pakistans-exports

PRR project: WB links $400 million loan to ‘result-based’ annual target

The World Bank (WB) has linked the $400 million loan for the Pakistan Rises Revenue (PRR) project to result-based annual target, saying once the results are attained, the government and the Federal Board of Revenue (FBR) will get the funds.

https://www.brecorder.com/news/40004422/prr-project-wb-links-400-million-loan-to-result-based-annual-target

Winter crops likely to face urea shortage on RLNG tariff issue

Winter crops are feared to face urea shortage as two fertiliser plants with 0.7 million tons of production capacity falter due to unavailability of re-gasified liquefied natural gas (RLNG) on competitive tariffs even in summer when gas demand is low, industry representatives said on Friday.

https://www.thenews.com.pk/print/685160-winter-crops-likely-to-face-urea-shortage-on-rlng-tariff-issue

SBP raises loan limit to Rs25m, cuts markup by 3pc

Following the directives of the federal government, the State Bank of Pakistan has announced reduction in the markup rate of Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme (PMKJ-YES) by 3 percent. According to the SBP, the federal government has approved revision in key features of Prime Minister’s Kamyab Jawan Youth Entrepreneurship Scheme and as per revised features of the scheme, loan limit has also been enhanced from Rs 5 million to Rs 25 million.

https://epaper.brecorder.com/2020/07/11/1-page/843924-news.html

KE may induct rental projects for limited period

The K-Electric (KE) and the power regulator on Friday hinted at inducting rental power projects and doing away with peak and off-peak tariff during the period of prolonged power cuts amid severe criticism from consumers over poor service and call for ending monopoly by allowing more utilities in the country’s largest metropolitan of 15 million.

https://www.dawn.com/news/1568231/ke-may-induct-rental-projects-for-limited-period

Asad Umar suggests businessmen to use RLNG

The pleas of the business community have finally been heard as the federal government has taken notice of the prolonged power outages in Karachi. Although it has assured of minimised load-shedding and resumption of gas supplies to industries and CNG stations, the government recommended that businessmen switch over to the expensive imported RLNG as a solution.

https://tribune.com.pk/story/2254454/asad-umar-suggests-businessmen-to-use-rlng