Pakistan’s market appears to be stuck in a limbo around the 48k mark because of a lack of notable upside triggers. Investor concerns largely stem from rising COVID-19 infection rates and burgeoning external account pressures resulting from the economy opening up. The upcoming result season, however, may influence the market’s trajectory as the financial results would largely reflect the recent economic upswing.

KASB Market View

The recent OPEC+ meeting may alleviate some concerns on Pakistan’s external front as the body has collectively agreed to scale up oil production. Oil prices have already fallen below USD 73/bbl from recent highs of USD 77/bbl. Moreover, we think investor participation may pick up post the extended Eid holiday week, after which investors are expected to closely monitor the result season. We continue recommending investors to play the economic up-cycle and build positions in cements, steel and automobiles.

National News

UAE, Saudi reach compromise: OPEC+ agrees oil supply boost

OPEC+ ministers agreed on Sunday to boost oil supply from August to cool prices which have climbed to 2-1/2 year highs as the global economy recovers from the coronavirus pandemic.

https://www.brecorder.com/news/40108069/uae-saudi-reach-compromise-opec-agrees-oil-supply-boost

Covid positivity rate jumps to 20pc in Karachi with 1,314 new cases

The positivity rate of Covid-19 cases reached up to 20.34 per cent in Karachi on Friday where 1,314 people tested positive for the infectious disease with 867 patients hospitalized at various health facilities, of whom 562 were on high flow oxygen and 177 on low flow oxygen.

https://www.thenews.com.pk/print/865251-covid-positivity-rate-jumps-to-20pc-in-karachi-with-1-314-new-cases

Senate adopts five bills

Senate, Friday, passed five bills; four government and a private member, including The Regulation of Generation, Transmission and Distribution of Electric Power (Amendment) Bill 2021 and FATF-related The Mutual Legal Assistance (Criminal Matters) (Amendment) Bill, 2021.

https://www.brecorder.com/news/40107789/senate-adopts-five-bills

Pharma sector announces countrywide sit-ins

Pharmaceutical sector has announced countrywide sit-ins and closure of pharmacies after Eidul Azha for indefinite period against the collection of advance tax through distributing companies. Talking to Business Recorder, Samad Budhani – Spokesperson Pakistan Chemists and Druggists Association (PCDA) urged to the federal government to withdraw the imposition of Section 236-G and 236-H of income tax on the pharmaceutical sector.

https://www.brecorder.com/news/40108030/pharma-sector-announces-countrywide-sit-ins

Panels set up to work out comprehensive plan for enhancing tax base

The government has constituted two committees to prepare a comprehensive plan by the end of current month for expansion of tax base through identification of new taxpayers.

https://www.dawn.com/news/1635753/panels-set-up-to-work-out-comprehensive-plan-for-enhancing-tax-base

Byco sees doubling of gross refining margin by 2025

The gross refining margin of Byco Petroleum — a vertically integrated energy firm with its own floating jetty, refinery and oil marketing arm — is expected to double from $3 per barrel to $6 once it completes the ongoing upgrade process by 2025, according to company chairman Mohammad Wasi Khan.

https://www.dawn.com/news/1635758/byco-sees-doubling-of-gross-refining-margin-by-2025

Govt withdraws duties on 4,000 tariff lines

The government withdrew customs duties on more than half of tariff lines which exporters should capitalize on to increase exports, commerce adviser said on Saturday.

https://www.thenews.com.pk/print/865625-govt-withdraws-duties-on-4-000-tariff-lines

FDI falls 28.9pc to $1.84bln in FY21

Foreign direct investment (FDI) in Pakistan fell 28.9 percent to $1.847 billion in FY2021, central bank data showed on Friday, as Covid put brakes on world economy as well as inflows into projects under China-Pakistan Economic Corridor (CPEC).

https://www.thenews.com.pk/print/865146-fdi-falls-28-9pc-to-1-84bln-in-fy21

Govt allocates Rs1.6trln for soft loans to farmers, entrepreneurs

The government has allocated Rs1.6 trillion in next three years to provide easy and concessionary loans to financially assist farmers and small businesses, the finance minister said on Saturday.

https://www.thenews.com.pk/print/865619-govt-allocates-rs1-6trln-for-soft-loans-to-farmers-entrepreneurs

PSDP 2021-22: Rs133.66bn released against budgeted Rs900bn

The federal government has released Rs133.66 billion (14.85 percent) for various ongoing and new development projects under the Public Sector Development Program (PSDP) 2021-22 against the budgeted allocation of Rs900 billion.

https://www.brecorder.com/news/40107925/psdp-2021-22-rs13366bn-released-against-budgeted-rs900bn

Bank credit to private sector declines to lowest: SBP

Formal credit to private sector in Pakistan has declined to one of the lowest among the emerging markets and developing economies (EMDEs), said a special report of the State Bank of Pakistan (SBP) issued on Friday.

https://www.dawn.com/news/1635754/bank-credit-to-private-sector-declines-to-lowest-sbp

ECC approves sugar import, fertiliser subsidy

The Economic Coordination Committee (ECC) of the cabinet on Friday approved import of 200,000 tons sugar, subsidy on DAP fertilizer for cotton and rice crops and procurement of 200,000 cotton bales by Trading Corporation of Pakistan.

https://www.thenews.com.pk/print/865144-ecc-approves-sugar-import-fertiliser-subsidy

Samsung mobile phone: Lucky Cement to set up assembly plant

Lucky Cement has announced that its subsidiary Lucky Motor Corporation (LMC) has entered into an agreement with Samsung Gulf Electronics (a South Korea based company) for producing Samsung mobile devices in Pakistan.

https://www.brecorder.com/news/40107783/samsung-mobile-phone-lucky-cement-to-set-up-assembly-plant

SBP foresees surge in current account deficit, inflation

Identifying certain structural vulnerabilities, the State Bank of Pakistan (SBP) is expecting surge in inflation and current account deficit in the future.

https://www.brecorder.com/news/40107793/sbp-foresees-surge-in-current-account-deficit-inflation

Pakistan to maintain growth trend

Pakistan’s central bank is expecting that the economy will maintain its growth momentum through bumpy roads in the current fiscal year 2022 as a likely higher inflation reading, high import payments and elevating exports would remain among key challenges during the year.

https://tribune.com.pk/story/2310948/pakistan-to-maintain-growth-trend

EU ambassador discusses improving bilateral trade

The European Union and Pakistan Business Council should work together to strengthen bilateral trade and economic ties with particular focus on small and medium enterprises (SMEs), said Ambassador of European Union to Pakistan Androulla Kaminara on Friday.

https://tribune.com.pk/story/2310954/eu-ambassador-discusses-improving-bilateral-trade

ECC approves hike in flour, sugar, ghee prices

The Economic Coordination Committee (ECC) of the cabinet Friday approved an increase in the rates of sugar, wheat flour and ghee at the Utility Stores Corporation (USC) of Pakistan.

https://www.thenews.com.pk/print/865106-ecc-approves-hike-in-flour-sugar-ghee-prices

Govt manages to get extension in ordinances

The opposition in the National Assembly Friday protested promulgation of ordinances and called for adopting the path of legislation after consideration by the two Houses of Parliament.

https://www.thenews.com.pk/print/865398-govt-manages-to-get-extension-in-ordinances

UN to finance projects in south Punjab

The United Nations has shown a keen interest in the uplift of the remote region of south Punjab and it would finance in health, education, environment, water management, human resource and infrastructural development.

https://www.thenews.com.pk/print/865356-un-to-finance-projects-in-south-punjab

Discos tariff: CPPA-G seeks paisa 80/unit increase for June

Central Power Purchasing Agency Guaranteed (CPPA-G) has sought an increase of Paisa 80 per unit in tariff of Discos for June 2021 under FCA mechanism.

https://www.brecorder.com/news/40107788/discos-tariff-cppa-g-seeks-paisa-80unit-increase-for-june