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Govt committed to follow macroeconomic fundamentals through effective policy...

September 25, 2020: Prime Minister's Advisor on Finance Dr Abdul Hafeez Shaikh says the government is committed to follow macroeconomic fundamentals through effective policymaking and targeted reforms to achieve sustainable and inclusive growth.

He was chairing a meeting of the Monetary and Fiscal Policies Coordination Board in Islamabad on Thursday. Special Secretary Finance said that the economy is on the path of recovery.

Adviser for Commerce and Investment said during the first two months of the fiscal year exports and imports remained 3.6 billion dollars and 6.9 billion dollars respectively which reduced the trade deficit.

Radio Pakistan

Govt to remove hurdles in way of business activities:...

September 25, 2020: Prime Minister Imran Khan has assured the businessmen and investors that the government is committed to remove all difficulties and hurdles in the way of business activities on priority basis.

Talking to a delegation of the country’s well known investors and business personalities in Islamabad, he said the development of construction sector would not only help promote business activities and create job opportunities but would also strengthen economy and boost wealth creation.

He expressed satisfaction over the interest shown by investors in the projects, including the Ravi River Front Urban Development and Bundle Island. He said the interest of local investors in the two important development projects initiated by the government is a good omen.

Expressing their views about the business-oriented environment in the country, the investors and business personalities said it was due to the present government’s efforts that there was not only an ease of doing business in the country but the business community was also encouraged by the better policies.

Radio Pakistan

European stocks slide in risk-off mood, M&A talk lifts...

September 25, 2020: European stocks slid on Thursday, with UK markets leading the way after Britain's government launched a scaled-back job support programme, while a second wave of COVID-19 cases across the continent dampened investor sentiment.

The pan-European STOXX 600 index fell 1.0% to close at its lowest level since Aug 3, with the retail, oil & gas and financial services sectors falling the most.

Investor fears about the resurgence of COVID-19 denting the European economic recovery have dominated trading this week as the UK, Spain and France imposed fresh restrictions, while U.S. Federal Reserve policymakers spooked markets on Wednesday by calling on the government to provide more fiscal support.

"Investor's expectations for a slow steady recovery have been tested in this month," Geir Lode, head of global equities, international at Federated Hermes wrote in a note.

"With the recent sentiment change in the market, it should be remembered that market volatility still exists. Exceptionally low interest rates and ample liquidity give investors few choices other than to invest in riskier assets."

M&A speculation drove a 1.3% rise in Italian banking stocks , while the European banking index slipped 0.4%.

Italy's third-largest bank Banco BPM jumped 5.8% and Credito Valtellinese surged 11.6%, with traders citing a Bloomberg report that suggested talks of possible takeover interest from French bank Credit Agricole.

Earlier, a Banco BPM spokeswoman said it was not in contact with bigger rival UniCredit over a potential merger, dismissing a press report. UniCredit rose 2.3%.

The STOXX 600 had cut losses earlier in the session after surveys showed business morale in Germany and France improved for the fifth month in a row in September, suggesting that both countries are set for strong growth in the third quarter.

The relief, however, proved temporary, with U.S. markets hesitating to rise after a surprise rise in weekly jobless claims.

The German DAX was down 0.3%, outperforming the regional indexes, while France's CAC 40 fell 0.8%.

UK's FTSE 100 lagged with a 1.3% drop, failing to draw cheer from a new job support plan. Under the "more targeted" programme, Finance minister Rishi Sunak said government support would only be available to workers whose employers keep them on at least a third of their normal hours.

British cinema operator Cineworld slumped 14.8% as it swung to a loss and said it may have to raise more money if pushed to shut its theatres again due to government curbs on social gathering.

 Reuters

SBP to Conduct 7 Day OMO

September 25, 2020 (MLN): The State Bank of Pakistan (SBP) announced that it will conduct a 7 day OMO to inject funds into the market.

Quotes timing is: 10:30 PST while result will be announced at: 11:00 PST

Settlement is same day - September 25, 2020

 

Copyright Mettis Link News

Asian markets rise after tough week but optimism at...

September 25, 2020: Asian markets rose Friday on bargain-buying after another torrid week for investors, who are growing increasingly concerned about US lawmakers' failure to even hold talks on a new stimulus and surging virus infections that are prompting fresh containment measures.

There was a sliver of hope Thursday for some movement on Capitol Hill after House Speaker Nancy Pelosi said Democrats had started putting together a $2.4 trillion rescue package and that they were still looking to find an agreement.

At the same time, Treasury Secretary Stephen Mnuchin reiterated that a new deal was still needed, adding: "If Democrats are willing to sit down, I'm willing to sit down any time for bipartisan legislation. Let's pass something quickly."

However, the proposal still dwarfs the Republicans' most recent offer and is also larger than the $1.5 trillion President Donald Trump said he is willing to accept.

While Federal Reserve boss Jerome Powell said the economy was performing better than expected for now thanks to income support, he told a congressional committee "it's likely that additional fiscal support will be needed".

"The risk is that they'll go through that money, ultimately, and have to cut back on spending and maybe lose their home," he said. "That's the downside risk of no further action."

Adding to the problems are heightened hostilities over a replacement for liberal Supreme Court justice Ruth Bader Ginsburg who died this week.

"The chances of passing another stimulus package appear to be dimming given the Supreme Court nomination is taking away much-needed oxygen, while the Democrats' latest proposal... is still well above where Republicans want to land," said National Australia Bank's Tapas Strickland.

The need for a new deal was highlighted by data showing jobless claims came in more than expected last week as the recovery in the world's top economy stutters owing to a pick-up in new virus cases.

- Stimulus 'a close call' -

Aneta Markowska, at Jefferies LLC in New York, said it was "a close call" on whether a new stimulus would be agreed, adding: "While still possible, there is a high risk that it does not happen this year. Without it, we would expect the economy to hit a major speed bump in the fourth quarter."

There was a little cheer from Washington after Republican Senate Majority Leader Mitch McConnell and others in the party joined the Democrats in assuring voters that the winner of the November 3 election would take office as planned in January.

The comments came after the president suggested he might not accept the result, citing unfounded claims of mail-in voter fraud.

Still, global traders are growing increasingly concerned about a surge in coronavirus infections in several countries that have seen governments impose partial lockdowns and social distancing measures, and shortening opening times for bars and restaurants.

The moves have sparked concerns of another painful hit to the economy.

"At this point in the recovery, a return to the Covid-19 abyss due to stricter lockdown measures is quite frankly something the global economy cannot afford," said Stephen Innes at AxiCorp.

He pointed to the negative market reaction to the imposition of "ultralight level of mobility restrictions".

"I think we dodged a bullet on this one so far, but this is not to say lawmakers who were slow to respond to the initial coronavirus outbreak will not re-impose stricter mobility restrictions if the Covid-19 curve steepens," he added.

In early Asian trade, Hong Kong, Tokyo, Shanghai, Seoul and Singapore enjoyed healthy gains, while Sydney jumped more than one percent. There were also gains in Manila and Jakarta.

- Key figures around 0230 GMT -

  • Tokyo - Nikkei 225: UP 0.6 percent at 23,221.40 (break)
  • Hong Kong - Hang Seng: UP 0.5 percent at 23,434.84
  • Shanghai - Composite: UP 0.2 percent at 3,230.55
  • Euro/dollar: UP at $1.1670 from $1.1667 at 2100 GMT
  • Pound/dollar: UP at $1.2754 from $1.2743
  • Euro/pound: DOWN at 91.50 pence from 91.54 pence
  • Dollar/yen: UP at 105.48 yen from 105.41 yen
  • West Texas Intermediate: UP 0.3 percent at $40.41 per barrel
  • Brent North Sea crude: UP 0.1 percent at $42.00 per barrel
  • New York - Dow Jones: UP 0.2 percent at 26,815.44 (close)
  • London - FTSE 100: DOWN 1.3 percent at 5,822.78 (close)

AFP/APP

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