November 28, 2019: European stock markets declined at the start of trading on Thursday, with London's benchmark FTSE 100 index down 0.5 percent at 7,391.37 points.
In the eurozone, Frankfurt's DAX 30 index also shed 0.5 percent to 13,226.99 points and the Paris CAC 40 lost 0.4 percent to 5,902.98, compared with Wednesday's closing levels.
AFP/APP
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April 5, 2020 (MLN): In the month of March 2020, the total deposits held by commercial banks has increased to Rs 15.13 trillion against Rs 13.45 trillion in the same month of last year, depicting a growth of 12% YoY.
On a sequential basis, deposits showed a mere growth of 2% as in February 2020 it stood at Rs 14.8 trillion, revealed the latest data issued by State Bank of Pakistan (SBP).
Meanwhile, total advances of commercial banks during the month also showed a meagre growth of 5% YoY to Rs 8.26 trillion compared to Rs 7.9 trillion recorded in the same month of 2019. While on a monthly basis, advances jumped marginally from Rs 8.2 trillion which decreased advances to deposit ratio by 1 ppts from 55.4% in February 2020 to 54.6% in March 2020. Whereas, on a yearly basis, this ratio decreased by 4ppt, as in March 2019 it was 58.6%.
On the other hand, total investment by commercial banks during the month displayed a jump of 62%YoY and 7%MoM to Rs 9.29 trillion.
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April 5, 2020 (MLN): The departed week witnessed many such actions taken by the local government and international agencies that could lead to lessening the impact of the COVID-19 outbreak on households and businesses.
On Friday, the Govt of Pakistan and World Bank signed a $200 million project for the COVID-19 response which will be utilized for emergency preparedness/response, emergency cash transfers to poor, emergency food supplies for quarantined populations, mitigation of impacts in education.
Meanwhile, the government offered up to Rs100 billion packages to the industrial sector as support following the current challenging situation, created due to COVID- 19 pandemic.
In addition to this, the Prime Minister Imran Khan also announced an incentivized package for the construction industry in the wake of coronavirus outbreak, as per which the investors investing in construction projects under Naya Pakistan Housing Authority, would get relief of ninety percent fixed tax and he will have to pay only ten percent tax. Moreover, withholding tax on construction will be lifted from all sectors, except steel and cement.
The same day, State Bank of Pakistan in the wake of challenges arising out of COVID-19 pandemic has expanded the scope of its recently announced relief package for households and businesses, by allowing similar relaxations, as provided under the relief package, on its concessional refinance schemes.
Furthermore, Advisor to Prime Minister on Commerce Abdul Razzaq Dawood said that the government has made a strategy to allow the export-related industry to start its operation in a phased-manner.
Moreover, the Economic Coordination Committee (ECC) of the Cabinet on Monday approved the fiscal stimulus package of Rs. 1.2 trillion aimed at addressing the ongoing challenges that emerged due to COVID-19 (Coronavirus) outbreak.
On the other hand, despite COVID-19 situation, Privatization Commission (PC) team, under the leadership of Federal Minister /Chairman Muhammad Mian Soomro continued to keep foreign investors engaged in the Privatization plan of the Government of Pakistan by holding a series of videoconferences/meetings with the pre-qualified investment parties for the privatization of two power plants (Haveli Bahadursha and Balloki) of National Power Plant Management Company Limited (NPPMCL).
The previous week also witnessed grants and support provided by the International agencies such as World Bank and ADB which include; $2 million grant by ADB to support the government’s efforts to combat the coronavirus (COVID-19) pandemic in the country and a $700 million additional financing by World Bank to help the country generate low-cost, renewable energy to provide affordable electricity supply to millions of users.
On the upside, Minister for Planning and Development, Asad Umar said that the Sensitive price indicator increase, the first time in more than a year has fallen to single-digit 9.27% which was the lowest increase in 14 months.
On the downside, Moody’s said that Pakistan is one of the countries that might face persistent tightening in financing conditions, which in turn will increase its debt burdens, weaken debt affordability and intensify external vulnerability risk.
Additionally, Moody’s further slashed Pakistan’s estimated growth rate to 2% for the current fiscal year due to the COVID-19 outbreak.
Similarly, according to Asian Development Bank’s (ADB) latest annual flagship economic publication, Asian Development Outlook (ADO) 2020, the Economic growth in Pakistan is expected to slow to 2.6 percent this year due to ongoing stabilization efforts, slower growth in agriculture and the impact of the COVID-19 outbreak, before recovering to 3.2 percent in 2021.
Lastly, the Oil and Gas Regulatory Authority (OGRA) on Tuesday issued a price-revision notification of Liquefied Petroleum Gas (LPG) for the month of April, as per which the authority reduced the locally produced LPG price by Rs 462.78 per cylinder of 11.8 kilograms.
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April 05, 2020: Adviser to Prime Minister for Commerce and Textile, Abdul Razak Dawood has said that the government had offered up to Rs100 billion packages to the industrial sector as a support following current challenging situation, created due to COVID- 19 pandemic.
“We are continuously in contact with all major industrial sectors, including textiles and construction. With consultation of all stakeholders, the government would give incentive to the priority areas of industrial sector for revival in current critical situation,” Razaq Dawood told APP here.
The government wanted to resolve the liquidity issue of industrial sector, he said adding that Drawback of Local Taxes and Levies (DLTL) payments would be made, which were pending since 2009.
The adviser said the government would pay Technology upgradation fund worth Rs 30 billion to the industrial sector to help it come out from the current challenge of COVID- 19 Coronavirus pandemic.
He informed that total Rs 47 billion would be paid to the textiles sector in coming 100 days to support the major export sector of the country.
Replying to a question, he said the government would pay all the refunds including in Rs 200 billion packages to compensate the industrial sector in coming Budget 2020-21.
He said that this package would be paid at faster pace to the industries, adding that all the stakeholders were on board with the government to evolve joint strategy to resolve all the issues of industrial sector in current situation.
He said that promoting industries and giving incentives to the business community was an important step to leading the country forward.The government would support the industrial sector and provide Incentives.
The commerce ministry has also prepared a list of industries which could be reopened in the current situation, he said.
The adviser said the refund of Rs100 billion for the business community is a part of that process and the government was committed to ensure timely refunds to the business community in this challenging situation.
Razak Dawood said that his ministry was in constant contact with the business community to figure out how the challenge posed by the epidemic can be resolved in country’s industrial sector.
He hoped the government and business community including all industrial was one page, with joint plan of action with consensus of all stake holders “we would overcome on economic challenges after the COVID-19 pandemic Coronavirus.
President of the Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Mian Anjum Nisar while talking to APP hailed the Rs 100 billion package offered by the government.
He said the government would take preventive measures and develop strategy to protect the pace of economic and trade progress and effects of world economic slowdown as apprehended by leading research organization after evolving the situation in COVID-19 pandemic.
Mian Anjum Nisar while talking to APP said that the whole world including the potential market of Europe Union (EU) was effected by the coronavirus, which was the second biggest trade destination for Pakistan after the Generalized Schemes of Preferences (GSP-Plus) offered by EU in 2013.
In this regard, the government must to go for conducting studies for mitigating the economic changes after Coronavirus.
Renowned industrialist from Baluchistan, Ex-President FPCCI , Eng. Daroo Khan welcomed the package announced by the government and said that proper mechanism was required to disburse this package according the needs for different industries.
He suggested that the government engage all stakeholder to resolve the current evolving challenge.
On the occasion, President Islamabad Chamber of Commerce and Industries (ICCI) Muhammad Ahmed Waheed said that his chamber was fully engage in consultation with government in current challenging situation.
Business community of the twin’s city welcomed the Rs100 billion package offered by the government for industrial sector.
President, Karachi Chamber of Commerce and Industries, Agha Shahab Ahmed Khan appreciated the government efforts for mitigating the current challenge.
He said that his chamber and business community from all over the country was committed to support the government in current evolving situation.
President, Peshawar Chamber of Commerce and Industry Engr. Maqsood Anwar Pervaiz said that business community of Khyber Puktunkwa (KPK in cooperation with government and stand with the government and lauded Rs 100 billion package announced by the government.
APP
Market Roundup:
The KSE-100 index gained around 3,512 points during the week and closed 31,621-mark i.e. nearly 12.49% percent higher than the closing of the previous week.
The spectacular performance by the stock markets over the week was a result of recovering in oil prices, the relief package announced by the Prime Minister for the construction industry as well as fall in CPI figures to 10.2%.
‘On the global front, Chinese manufacturing data showed a sharp recovery in March following two months of lockdown, gave a boost to global equities. Meanwhile, OPEC+ decided to hold a virtual meeting on Monday to cut oil production’, Spectrum Securities said in its report.
Commercial Banks once again made the headlines but for the right reasons, as it emerged as the largest gaining sector with nearly 765 points added to its kitty. This was followed by E&P Companies, Cement and Power Generation Sectors, which gained nearly 796, 535 and 388 points respectively. Within these sectors, HUBC, LUCK, UBL, MARI and HBL made gains of 290 pts, 227 pts, 185 pts, 145 pts and 143 pts respectively.
Figures released by NCCPL showed that foreign investors dumped USD 36.1 million worth of stocks during the week with foreign corporates doing the bulk of the selling.
On the local front, Individual investor picked up USD 13 million worth of stocks, followed by USD 10 million and USD 9 million of stocks purchased by Mutual Funds and Insurance companies respectively.
Forex Roundup:
PKR stabilized during the current week, losing 1.225 rupees or 0.74 percent against the dollar during the course of the week to close at 166.7666.
The rupee traded in a much narrower range hitting a weekly low of 167.05 (bid) and a high of 165.75 (ask), as the 10 day volatility decreased from 14.86 percent to 14.34 percent.
According to traders, there was not much active trading as banks simply squared their positions.
The outflow of foreign investment in government securities during the month of March was USD 1.77 billion.
Furthermore, SBP reserves have decreased by USD 1.57 billion during the month of March (figures as of March 27, 2020).
Fixed Income:
Secondary market yields continued to decline with 3m, 6m and 12m T-Bills coming down by a further 21, 32 and 46 basis points, while 3 and 5 year yields came down by 45 bps and 10 year yields decreased by 40 bps.
Since the start of 2020, yields have come down by 245, 256 and 284 bps for 3, 6 and 12 months while PIB yields have decreased by 226, 172 and 190 bps for 3, 5 and 10 year.
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| Weekly Performance | ||
|---|---|---|
| Apr 03, 2020 | Mar 27, 2020 | |
| PKR InterBank | 166.7666 | 165.5409 |
| KSE100 Index | 31,621.79 | 28,109.57 |
| Avg Daily Volume | 227,580,457 | 149,931,216 |
| Gold (Karachi) Rs/10 gm | 82,047 | - |
| KIBOR 6M | 11.00 | 11.25 |
| 10Y PIB | 9.10 | 9.50 |
| EUR | 1.0799 | 1.1166 |
| GBP | 1.2264 | 1.2454 |
| CHF | 0.9764 | 0.951 |
| JPY | 108.4 | 107.91 |
| GOLD | 1616.4 | 1621.8 |
| NY Light Crude | 29 | 21.84 |
| Open Market Rates | ||
| Apr 03, 2020 | Mar 27, 2020 | |
| USD | 167.00 | 166.00 |
| EUR | 180.86 | 185.52 |
| GBP | 205.02 | 206.89 |
| JPY | 1.5415 | 1.5392 |
| AED | 45.51 | 45.23 |
| SAR | 44.48 | 44.28 |
| SBP Data | ||
| T-Bill Auction Cutoff Yield | Mar 25, 2020 | Mar 11, 2020 |
| 3M | 11.2985 | 12.7288 |
| 6M | 11.2989 | 12.5050 |
| 12M | 10.8699 | 12.0000 |
| PIB Auction Cutoff Yield | Mar 04, 2020 | Feb 04, 2020 |
| 3Y | 11.5888 | 12.0500 |
| 5Y | 10.9900 | 11.4000 |
| 10Y | 10.8500 | 11.0000 |
| 20Y | 11.7999 | Bids Rejected |
| Interest Rate Corridor | Jul 17, 2019 | May 21, 2019 |
| SBP Policy Rate | 13.25 | 12.25 |
| SBP Reverse Repo Rate | 13.75 | 12.75 |
| SBP Repo Rate | 11.75 | 10.75 |
| Weekly Indicators | ||
| Mar 27, 2020 | Mar 20, 2020 | |
| SBP FX Reserves * | 11,185.60 | 11,989.20 |
| Bank FX Reseves * | 6,201.90 | 6,115.90 |
| Total FX Reserves * | 17,387.50 | 18,105.10 |
| Apr 03, 2020 | Mar 26, 2020 | |
| SPI (Combined Group) ** | 125.52 | 128.10 |
| Change - WoW (pct) | -2.01 | -1.25 |
| Change - YOY (pct) | 9.27 | 11.86 |
| Monthly Indicators | ||
| March | February | |
| Consumer Price Index (Base 2015-16) | 133.03 | 130.45 |
| Change - MOM (pct) | 1.97 | -0.34 |
| Change - YOY (pct) | 14.56 | 12.63 |
| WholeSale Price Index (Base 2015-16) | 144.34 | 141.75 |
| Change - MOM (pct) | 1.83 | -0.30 |
| Change - YOY (pct) | 15.36 | 12.37 |
| Sensitive Price Indicator (Base 2015-16) | 131.61 | 130.36 |
| Change - MOM (pct) | 0.96 | -1.26 |
| Change - YOY (pct) | 19.53 | 18.20 |
| March | February | |
| Exports * | 1,807.00 | 2,140.00 |
| Imports * | 3,299.00 | 4,185.00 |
| Trade Balance * | -1,492.00 | -2,045.00 |
| February | January | |
| Home Remittances * | 1,824.32 | 1,907.32 |
| February | January | |
| Total Foreign Investment * | 562.65 | 1,613.24 |
| Quarterly Indicators | ||
| Dec 31, 2019 | Sep 30, 2019 | |
| Pakistan's External Debt * | 111,047.07 | 107,058.99 |
| Annual Indicators | ||
| 2018-19 | 2017-18 | |
| GDP Growth Rate | 3.29 | 5.53 |
| Agriculture | 0.85 | 3.94 |
| Manufacturing | -0.27 | 5.43 |
| Commodity Sector | 1.13 | 4.45 |
| Services Sector | 4.71 | 6.25 |
| Trade Balance * (July - June) | -31,820.00 | -37,583.00 |
| Worker Remittances * (July - June) | 21,841.50 | 19,913.55 |
| Foreign Investment * (July - June) | 329.89 | 5,680.93 |
| Annual Inflation Rate % (July - June) | 7.32 | 3.92 |
| * Amount in USD Million | ||
| ** Weekly SPI Data for Sep 26, 2019 Not Released by PBS | ||
