Pakistan’s market has been stuck in a limbo around the 48k mark because of absence of any notable upside triggers. Investor concerns largely emanate from rising COVID-19 infection rates and external account pressures, reflecting in the weakening of the Pak Rupee. The upcoming result season, however, may affect the market’s direction as the financial results would largely reflect the recent economic upswing.

KASB Market View

The upcoming monetary policy is likely to be a non-event with the market already incorporating in a ‘no-change’ stance. Investors are expected to closely track the recent currency volatility and the economic data points to formulate their investment strategy. We continue recommending building positions in cyclical stocks including cements, and automobiles.

National News

No change likely in key interest rate

Analysts expect that the State Bank of Pakistan (SBP) will keep the benchmark interest rate unchanged at seven per cent at the upcoming meeting of the monetary policy committee (MPC) next week.

https://www.dawn.com/news/1636588/no-change-likely-in-key-interest-rate

New chapter in stock market as 90-day DFCs open tomorrow

The maiden Deliverable Futures Contracts (DFCs) of 90-day maturity will be opened on the Pakistan Stock Exchange (PSX) on July 26 — a move aimed at curbing the market volatility witnessed in the last week of every month when traders roll over their contracts to the next month to avoid settlement.

https://www.dawn.com/news/1636773/new-chapter-in-stock-market-as-90-day-dfcs-open-tomorrow

Covid spike forces Sindh to close eateries, educational institutions

Following an abnormal spike in Covid-19 cases across Sindh, the provincial government on Friday decided to close indoor and outdoor dining at restaurants and marriage halls, shrines, recreational spots and educational institutions, except those where examinations are taking place, and reduced timings of markets from Monday.

https://www.dawn.com/news/1636593/covid-spike-forces-sindh-to-close-eateries-educational-institutions

PD finalises new draft PPA with KE along with disputes

The Power Division has reportedly finalized new draft Power Purchase Agreement (PPA) with Karachi Electric (KE) along with disputes, to be submitted first to the Economic Coordination Committee (ECC) and then Cabinet for approval, well-informed sources told Business Recorder.

https://www.brecorder.com/news/40108752/pd-finalises-new-draft-ppa-with-ke-along-with-disputes

Forex reserves rise to $25.1bln

Pakistan’s foreign exchange reserves surged by $816 million or 3.35 percent in the week ended July 16, the central bank said on Thursday.

https://www.thenews.com.pk/print/867439-forex-reserves-rise-to-25-1bln

Crude oil imports surge 317pc in May

Imports of crude oil increased by a whopping 317 per cent in May which translated into higher than expected production of petroleum products by local refineries and its exports from the country.

https://www.dawn.com/news/1636587/crude-oil-imports-surge-317pc-in-may

SECP unveils oily affairs

Securities and Exchange Commission of Pakistan’s (SECPs) internal correspondence has reportedly unveiled unsavory affairs of M/s Hascol Petroleum and M/s Vitol Dubai Limited.

https://www.brecorder.com/news/40109033/secp-unveils-oily-affairs

Asian spot prices for LNG rise

Asian spot prices for liquefied natural gas (LNG) jumped this week to a more than six-month high, as warm temperatures drove up demand for the fuel used in electricity generation, industry sources said.

https://www.dawn.com/news/1636589/asian-spot-prices-for-lng-rise

Pakistan’s real effective exchange rate stands at 99.9 in June

Pakistan’s real effective exchange rate (REER) clocked in at 99.9 in June, depicting a change of 2.3 percent from the previous month’s level of 102.2, the central bank reported on Friday.

https://www.thenews.com.pk/print/867436-pakistan-s-real-effective-exchange-rate-stands-at-99-9-in-june

Services trade deficit declines by 43pc in FY21

Pakistan’s service trade deficit shrank 43 percent during the last fiscal year (FY21) mainly due to lower international travel payments in wake of Covid-19 pandemic.

https://www.brecorder.com/news/40109032/services-trade-deficit-declines-by-43pc-in-fy21

Country likely to miss cotton production target

The country is likely to-miss cotton production target of 10.5 million bales due to high inputs costs including fertilizers, diesel, tractors, pesticides, and water shortage issues.

https://www.brecorder.com/news/40108740/country-likely-to-miss-cotton-production-target

Stock Options
-Word of the Day-

A stock option gives an investor the right, but not the obligation, to buy or sell a stock at an agreed upon price and date. There are two types of options: puts, which is a bet that a stock will fall, or calls, which is a bet that a stock will rise.