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Shares at PSX reverse trend after yesterday’s hammering

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Shares at PSX reverse trend after yesterday’s hammering

The benchmark KSE-100 index rose 448.88 points, or 1.17 per cent, to close at 38,791.09 points. It reached an intraday high of 38,945.97 points, up 603.76 points, or 1.57pc, around 3:28pm.

“The market was in the oversold territory after the sharp correction earlier in the week, so a pullback is not a major surprise,” said Intermarket Security’s Head of Equity Raza Jafri.

He said the market also received a boost from State Bank of Pakistan (SBP) Governor Jameel Ahmad’s assurance that opening of letters of credit (LCs) would be facilitated in a better manner.

“For the market to rise higher though, further clarity on politics and more comfort on the economy is a must,” Jafri added.

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Topline Securities Senior Manager Equity Mohammad Arbash attributed the index’s recovery to the SBP governor’s assurance of inflows and a stop to the rapid decline in foreign exchange reserves.

He added that the pressure caused by a sell-off by mutual fund managers and institutions also eased and a buying spree in the refinery and technology sectors at the lower level led to the index’s rise.

“Stocks showed a strong recovery in the earnings season on SBP chief’s affirmation over easing forex crisis in the coming days and institutional interest in oversold scrips,” commented Arif Habib Corporation’s Ahsan Mehanti.

He noted that mid-session pressure remained because of political uncertainty and a delay in the disbursement of a $1.1 billion loan by the World Bank. However, investor speculations over imminent inflows from the United Arab Emirates and Saudi Arabia for financial support played a catalyst role in the bullish close, he added.

Pakistan secured a lifeline of about $4bn from the UAE and Saudi Arabia last week to sail through the immediate challenge of a sovereign default amid rapidly shrinking foreign exchange reserves, massive flood damages and an overall economic slowdown.

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Two separate official announcements said the UAE pledged to roll over $2bn debt payable over the next two months and topped this with an additional $1bn support.

Separately, the Saudi Fund for Development signed an agreement in Islamabad to fund $1bn worth of oil imports on deferred payment.

A day earlier, the index plunged by 1,378.54 points, or 3.47pc, to close at 38,342.21 points, its lowest level since July 27, 2020.

Yesterday’s sell-off marked the highest one-day slide since June 24, 2022, according to Arif Habib Limited.

Analysts have attributed the index’s recent decline to the increasing political uncertainty as two provincial assemblies have been dissolved as part of the opposition’s strategy to force early general elections.

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Meanwhile, the country’s forex situation has worsened with the SBP’s reserves falling to $4.34 billion, the lowest since February 2014.

The country has been facing a serious dollar shortage, which is resulting in restricted imports of even food and industrial raw materials. The latest position of foreign exchange reserves reflects that the country doesn’t have sufficient dollars to cover even one month of average imports.

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Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

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Chinese firm aims to expand investments in Pakistan, shows interest in mining sector

 A notable Chinese company has expressed keen interest in expanding its investment in Pakistan, in yet another sign of investor confidence boost in the leadership of Prime Minister Shehbaz Sharif.

A delegation from Chinese firm MCC Tongsin Resources led by its Chairman Wang Jaichen called on PM Shehbaz here on Friday.

The premier invited the Chinese company to invest in Pakistan’s mining sector and manufacturing of export goods.

Shehbaz assured the delegation that his government would extend all-out facilitation to the company from minerals exploration and processing to the export of goods.

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The PM instructed the relevant federal ministers and officers to continue consultation with the Chinese firm, taking the Balochistan chief minister, provincial departments and stakeholders on board.

The delegates reposed trust in PM Shehbaz’s leadership, and expressed keen interest in enhancing their investment in Pakistan’s mining and minerals sectors.

The delegation briefed Prime Minister Shehbaz about the construction of a mineral park in Pakistan and their future investment plans.

The premier welcomed the Chinese firm and highlighted the priority steps by his government to promote foreign investment in Pakistan.

He said that being a time-tested friend, China supported Pakistan in every difficult hour for which the Pakistani nation was grateful to the leadership and people of China.

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Federal ministers Ahad Khan Cheema, Dr Musaddik Malik, Rana Tanveer Hussain, Jam Kamal Khan and relevant senior officers attended the meeting.

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Govt jacks up power price by Rs1.47 per unit

Govt jacks up power price by Rs1.47 per unit

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Govt jacks up power price by Rs1.47 per unit

The government on Friday increased the electricity tariff by Rs1.47 per unit.

According to Nepra sources, the collection from consumers will take place in August, September, and October.

The electricity companies had requested the funds as part of the third quarter adjustment for 2023-2024, seeking Rs 31.34 billion under capacity charges.

Sources said that Rs5.57 billion were requested for operation and maintenance costs, and Rs12.38 billion were requested for the transmission and distribution impact under monthly fuel cost adjustment.

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Previously, Nepra had completed the hearing on the electricity companies’ request under the quarterly adjustment.

Nepra approved the Power Division’s request, allowing an increase of Rs 1.45 per unit in electricity prices.

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Hong Kong allows China’s digital yuan to be used in local shops

Hong Kong allows China’s digital yuan to be used in local shops

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Hong Kong allows China's digital yuan to be used in local shops

Hong Kong will allow mainland China’s pilot digital currency to be used in shops in the city, the head of its de facto central bank said on Friday, marking a step forward for Beijing’s efforts to internationalise the yuan amid rising geopolitical tensions.

The programme, backed by Beijing, will allow mainland Chinese and Hong Kong residents to open digital yuan wallets via a mobile app developed by China’s central bank and will permit them to make payments in retail shops and some online stores in Hong Kong and in mainland China.

Transactions using e-CNY, predominantly for domestic retail payments in China, hit 1.8 trillion yuan ($249.27 billion) as of end of June 2023, with 120 million digital wallets opened, according to the latest disclosure from China’s central bank.

Using the wallet, users can make payments at over 10 million merchants in 17 provinces and cities in the mainland.

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Each wallet used in the city will be subject to a balance limit of 10,000 yuan, with single transactions and daily payments capped at 2,000 yuan and 5,000 yuan, respectively, officials from the Hong Kong Monetary Authority said.

Peer-to-peer transfers will not be allowed at the moment, according to the HKMA.

“By expanding the e-CNY pilot in Hong Kong .. users may now top up their wallets anytime, anywhere without having to open a mainland bank account, thereby facilitating merchant payments in the mainland by Hong Kong residents,” HKMA Chief Eddie Yue said.

Currently, users of other digital yuan wallets such as those operated by Ant Group and Tencent can make payments in the city.

Industrial and Commercial Bank of China, Bank of China Ltd, China Construction Bank Corp and Bank of Communications Co have been selected as e-CNY wallet operators.

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The yuan’s use in global finance remains low, though it has shown steady increases.

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