After the announcement of imposing Capital Value Tax on trading of shares in the finance bill of 2010-2011 there are many days where the downward trend has been observed in the stock exchange. After witnessing a mixed trend on Tuesday, the KSE-100 index finally closed at the level of 9,250.55 points with a net gain of 20.95 points. The market opened on a positive note as the investors took fresh positions on low levels and the index hit 9,369.38 points intra-day high, up 139.78 points.
However, uncertainties over imposition of Capital Gains Tax forced the investors to off-load their holdings after mid session and the index dropped into negative zone at 9,175.79 points intra-day low level, down 53.81 points. The index, however, managed to close in positive due to late buying in some selective stocks.
Trading activities remained low due to investors' lack of interest and the volumes at ready counter declined to 82.953 million shares as compared to 89.526 million shares traded on Monday. The overall market capitalisation increased by Rs 7 billion to stand at Rs 2.605 trillion. Out of the total 406 active scrips, 209 closed in positive and 175 in negative while the value of 22 scrips remained unchanged.
Lotte Pakistan was the volume leader with 12.057 million shares, however lost Re 0.12 to close at Rs 8.61. Hub Power Co declined by Rs 1.41 to close at Rs 30.74 with 10.603 million shares. BoP gained Re 0.47 to close at Rs 10.02 with 4.264 million shares. WorldCall Telecom increased by Re 0.19 to close at Rs 3.35 with 4.078 million shares. Jahangir Siddiqui Co inched up by Re 0.18 to close at Rs 11.33 with 3.469 million shares.
DG Khan Cement gained Re 0.44 to close at Rs 23.40 with 3.389 million shares. TRG Pakistan inched up by Re 0.07 to close at Rs 4.64 with 2.476 million shares. Lafarge Pakistan gained Re 0.03 to close at Rs 2.70 with 2.423 million shares. Lucky Cement increased by Re 0.23 to close at Rs 61.20 with 2.035 million shares. Nishat Mills lost Re 0.81 to close at Rs 44.05 with 1.966 million shares.
Siemens Pak and Unilever Pakistan were the highest gainers and increased by Rs 48.61 and Rs 46.55 to close at Rs 1022.10 and Rs 4050.00 respectively while Unilever Food and Hinopak Motor were the worst losers and declined by Rs 10.01 and Rs 4.17 to close at Rs 979.99 and Rs 118.50 respectively.
Ahsan Mehanti at Shehzad Chamdia Securities said that a mixed activity was witnessed as uncertainty loomed over pending capital gain tax issues in Pakistan capital markets. Although the market witnessed healthy opening on the back of expectations of positive outcome of meetings between senate standing committee and KSE officials on capital gain tax regulations for foreign and local investors scheduled on Wednesday. The recovery in global capital markets and rise in international oil prices also supported positive activity initially, however investors lack of confidence was also seen due to their concerns over lack of clarity on key budgetary issues.
Wednesday, June 16, 2010
KARACHI (June 16 2010): Due to Poor management of our ministry and doubtful ability of Pakistan Peoples Party to run the affair of the country, Net foreign investment has posted a decline of 15 percent during the first eleven months of the current fiscal year mainly due to slow foreign direct investment followed by global economic recession, poor law and order situation and uncertainty on political front.
The central bank on Tuesday revealed that net foreign investment comprising foreign direct investment (FDI) and portfolio investment is continuously weakening and it has registered a decline of some $330.6 million during the first eleven months (July-May) of fiscal year 2009-10. With current decline, net foreign investment has decreased to $1.896 billion during the July-May of the current fiscal year as compared to $2.22 billion in same period of last fiscal year.
"Major reason behind this dip is decline in the FDI inflows, as the foreign investors are reluctant to invest in Pakistan due to political uncertainty and worst law and order situation," economists said. However, they believed that in the next few months some improvement would be witnessed on the foreign investment, as Pakistan's economy is growing well and during the current fiscal year the country has achieved over the target GDP growth.
They said that some $1.89 billion net foreign investment during the first eleven months is also a encouraging figure, as despite the uncertainty foreign investment inflows are higher than expectations, which is a positive sign and it means that still foreign investors are interested to invest in Pakistan.
According to statistics FDI has posted a decrease of 39 percent, while portfolio investment has registered a surge of 88 percent during the period. With this reduction, FDI has declined to $2.031 billion in July-May of fiscal year 2010 as compared to $3.33 billion in corresponding period of last fiscal year, depicting a decrease of $1.3 billion. Including privatisation proceeds total private investment shows a decline of 7.2 percent to $2.57 billion during July-May of current fiscal year, which previously stood at $2.77 billion.
The central bank on Tuesday revealed that net foreign investment comprising foreign direct investment (FDI) and portfolio investment is continuously weakening and it has registered a decline of some $330.6 million during the first eleven months (July-May) of fiscal year 2009-10. With current decline, net foreign investment has decreased to $1.896 billion during the July-May of the current fiscal year as compared to $2.22 billion in same period of last fiscal year.
"Major reason behind this dip is decline in the FDI inflows, as the foreign investors are reluctant to invest in Pakistan due to political uncertainty and worst law and order situation," economists said. However, they believed that in the next few months some improvement would be witnessed on the foreign investment, as Pakistan's economy is growing well and during the current fiscal year the country has achieved over the target GDP growth.
They said that some $1.89 billion net foreign investment during the first eleven months is also a encouraging figure, as despite the uncertainty foreign investment inflows are higher than expectations, which is a positive sign and it means that still foreign investors are interested to invest in Pakistan.
According to statistics FDI has posted a decrease of 39 percent, while portfolio investment has registered a surge of 88 percent during the period. With this reduction, FDI has declined to $2.031 billion in July-May of fiscal year 2010 as compared to $3.33 billion in corresponding period of last fiscal year, depicting a decrease of $1.3 billion. Including privatisation proceeds total private investment shows a decline of 7.2 percent to $2.57 billion during July-May of current fiscal year, which previously stood at $2.77 billion.
Circular Debt Management
ISLAMABAD (June 16 2010): PPP is performing very poor. All the Load shedding is due to non payment to Power Generation Companies and Oil Companies providing Oil to Power Generation Companies. The planned load shedding was to introduce rental power projects. Mr. Imran Khan and Mr. Faisal Saleh Hayyat are claiming that Mr. Asif Ali Zardari has played all the game for getting benefit from rental power projects. There are many corruption stories in the media but president is not ashamed off on what he is doing or going to do. Prime Minister Syed Yusuf Raza Gilani on Tuesday directed immediate release of Rs 41. 4 billion to Pakistan State Oil on account of circular debt. The Prime Minister was chairing a special meeting to review the circular debt situation arising out of the pending payments to PSO. Gilani decided that the Ministry of Finance would arrange an amount of Rs 31.4 billion while Pepco would pay Rs 10 billion to PSO.
The Prime Minister said all the stakeholders particularly the provincial governments should honour their commitments made during the Energy Summit and pay their outstanding dues to help reduce the circular debt. The Prime Minister directed the concerned ministries and organisations for close co-ordination among all the stakeholders including the provincial governments within the next few days to resolve the circular debt issue lest it leads to any crisis. The circular debt, he said, be regularly monitored on a daily basis and the dues/claims of different organisations including provincial governments be settled.
Earlier, the Minister for Petroleum & Natural Resources briefed the meeting about the gravity of the situation arising out of the delay in payments to PSO by various power companies. The Minister for Water & Power apprised the meeting of the delay in payments by the provincial governments as per commitment made during the Energy Conference.
The PM was also informed of the recoveries made by Pepco from various organisations so far. He further opined that the issue of circular debt can only be resolved when the gap between the cost of production and the price of electricity is eliminated. The Minister for Finance assured that the amount due against the federal government as per the Energy Summit decision would be cleared within the next few days.
Tahir Basharat Cheema, MD Pepco informed that Pepco would be able to partially clear the PSO bills from the recoveries made so far and likely to be made till the end of this month. The meeting was also attended by Minister of State for Finance and Economic Affairs Hina Rabbani Khar, Secretary Finance, Secretary Water and Power and Additional Secretary Petroleum and Natural Resources.
The Prime Minister said all the stakeholders particularly the provincial governments should honour their commitments made during the Energy Summit and pay their outstanding dues to help reduce the circular debt. The Prime Minister directed the concerned ministries and organisations for close co-ordination among all the stakeholders including the provincial governments within the next few days to resolve the circular debt issue lest it leads to any crisis. The circular debt, he said, be regularly monitored on a daily basis and the dues/claims of different organisations including provincial governments be settled.
Earlier, the Minister for Petroleum & Natural Resources briefed the meeting about the gravity of the situation arising out of the delay in payments to PSO by various power companies. The Minister for Water & Power apprised the meeting of the delay in payments by the provincial governments as per commitment made during the Energy Conference.
The PM was also informed of the recoveries made by Pepco from various organisations so far. He further opined that the issue of circular debt can only be resolved when the gap between the cost of production and the price of electricity is eliminated. The Minister for Finance assured that the amount due against the federal government as per the Energy Summit decision would be cleared within the next few days.
Tahir Basharat Cheema, MD Pepco informed that Pepco would be able to partially clear the PSO bills from the recoveries made so far and likely to be made till the end of this month. The meeting was also attended by Minister of State for Finance and Economic Affairs Hina Rabbani Khar, Secretary Finance, Secretary Water and Power and Additional Secretary Petroleum and Natural Resources.
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