The stock market failed to
maintain its position above the
18,000-point barrier as the
worsening law and order situation
in Karachi and weak macroeconomic
data took its toll on the benchmark
KSE-100 index, which closed down
221 points or 1.2% during the week
ended March 8.
A variety of positive sector-specific
news could not save the index from
losses as investors also shifted their
focus towards the political scenario
where the current government is due
to complete its tenure in the coming
week and pave the way for a caretaker
setup until general elections, due to be
held in May.
The week started off on a negative
note following a massive bomb blast in
Abbas Town, Karachi on Sunday
evening which left 50 people dead and
140 wounded. The already tense
situation was intensified when the
Muttahida Qaumi Movement
announced that it will go on an
indefinite strike unless the
perpetrators were captured. However,
the party cancelled those plans on the
insistence of trade unions.
On the macro front, the foreign
exchange reserves of the country
dipped below the $13 billion mark
declining $380 million during the week
to close at $12.81 billion. The forex
reserves have been on a constant
decline after hitting a record high
above $18 billion in July last year.
Auction of treasury bills was also held
during the week where cut-off yields
rose 2-9 basis points. The increase in
yields meant that further monetary
easing was unlikely and with inflation
slowly creeping up, a round of
discount rate hikes might be on the
horizon, which will have a negative
impact on the market.
There was bad news for the telecom
sector, as the contentious International
Clearing House (ICH) issue was raised
in the United States, where the Federal
Communications Commission (FCC)
prohibited US telecom providers from
paying anything above the pre-ICH
rate of 2 cents per minute for
termination of calls to long distance
and international operators in
Pakistan.
Under the ICH regime, this rate has
been hiked up to 8.8 cents per minute
and resulted in windfall profits for
telecom operators in Pakistan, as the
arrangement did not require any
additional expenditure. Pakistan
Telecommunications Company (PTCL),
the operator of the ICH, took a beating
and shed 11% of its value during the
week.
However, it was not all bad news as
there were positives for the fertiliser,
refinery and chemical sectors all
emanating from pending decisions of
the Economic Coordination Committee.
Engro was the main beneficiary on the
fertiliser end as the ECC is likely to
approve gas supply of 79 million cubic
feet per day (mmcfd) to its Enven
plant. The stock climbed 4.4% during
the week.
The refinery sector also received
positive news as the ECC was expected
to increase deemed duty – customs
and surcharge duty on imported oil –
from 7.5% to 9% on refinery products.
Similarly, the ECC is also likely to
approve an increase in import duty on
purified terephthalic acid (PTA) from
3% to 4%, resulting in a boost to local
manufacturers of PTA.
Average daily volumes plummeted
27% to 236 million shares. Similarly,
average daily values declined 21% to
Rs7.07 billion. The market
capitalisation of the KSE declined 1%
to Rs4.46 trillion by the end of the
week.
Winners
Dawood Hercules
Dawood Hercules Corporation
produces urea fertilisers. The
company also produces anhydrous
ammonia for manufacturers of soda
ash, fructose, and other chemicals.
Attock Refinery
Attock Refinery, a subsidiary of the
Attock Oil Company, specialises in the
refining of crude oil
Nishat Chunian Power
Nishat Chunian Power owns, operates
and maintains a fuel-fired power
station for the generation, supply and
transmission of electric power in
Kasur, Punjab. The company is a
subsidiary of Nishat (Chunian)
Limited.
Losers
Jahangir Siddiqui and Company
Jahangir Siddiqui and Company is an
investment company offering share
brokerage, money market, advisory
and consultancy, underwriting and
portfolio management services.
JS Bank
JS Bank is a full service commercial
bank. The bank provides a wide range
of banking products and services
including retail and consumer,
treasury, corporate and commercial,
and investment banking.
Azgard Nine
Azgard Nine manufactures and
exports textile products such as denim
fabrics, and apparel. The company also
manufactures and sells urea and
phosphatic fertilisers from its fertiliser
plants.
Published in The Express Tribune,
March 10th, 2013.
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Sunday, March 10, 2013
Weekly review: Karachi Stock Exchange dips below 18,000 points amidst fog
Wednesday, March 6, 2013
Dow Jones Closes at Record High
When the trading day ended on
Tuesday, the Dow Jones Industrial
Average closed at a record high of
14,253.77. It surpassed the index’s
previous closing high of 14,164.53
reached back in the pre- recession
days of October 2007. For all the
headlines devoted to the event, you’d
think this was a really big deal —
either a signal that our economy has
zoomed past the lingering aftereffects
of the Great Recession, or evidence of
a bubble about to pop, as CNBC
wondered a little while ago.
The reality is probably much less
exciting. “Investors should curb their
enthusiasm,” says Mitchell O.
Goldberg, president of ClientFirst
Strategy. Experts say the Dow’s
record high means relatively little in
the grand scheme of things. Here are
a few reasons why:
The Dow Doesn’t Reflect the Entire
Economy
“To the average guy in the public, the
Dow means the market,” says Wayne
S. Kaufman, chief market analyst at
John Thomas Financial. “But it’s only
30 stocks.” What’s more, the index is
price-weighted, meaning more
expensive stocks have an outsized
impact on the number.
The 30 stocks that currently
constitute the Dow Jones Industrial
Average make up a pretty narrow
slice of American economic output.
Analysts say the S&P 500, a much
bigger index, is more reflective of the
market as a whole. (It ended Tuesday
at a five-year high, but fell short of
record-breaking status.)
( MORE: Are We Already Planting the
Seeds of the Next Financial Crisis?)
Also, the companies included in the
Dow have changed over the years,
and inflation is not factored in, so
measuring today’s record against its
previous high is an apples-to-oranges
comparison. “When you see the Dow
hitting new highs, it’s not the same
Dow we had in ’07,” Goldberg says. He
points out that manufacturing
stalwart General Motors was booted
out, as were Citigroup and Kraft, and
he argues the current index skews
too tech-heavy to encompass the true
scope of the U.S. economy.
The Fed Did This — and It Can Undo
It Too
Stocks have been particularly
buoyant because they’re floating on
an ocean of liquidity, courtesy of the
Federal Reserve. The Fed has been
buying up trillions of dollars of bonds
to stimulate the economy. That has
driven down yields and interest rates.
“Back in 2007, bond yields were 5%
on a 10-year [government] bond,”
Kaufman says. ”Today, we’re at
1.9%.” As a result, many investors
who are looking for better returns
have given up on bonds and piled into
the equities market, since many are
still soured on real estate as an
investment vehicle.
“So long as the Fed is in an
accommodative mode and the
economy is out of recession, the odds
are that you will have a bull
market,” David Rosenberg, chief
economist at Gluskin Sheff and
Associates, told the New York Times
Tuesday.
“The Fed seems willing to remain
accommodative,” says Matthew
Coffina, editor of Morningstar’s
StockInvestor subscription
newsletter. Plus, he adds, stocks are
considered to be a better hedge
against inflation when the economy
does pick up steam again.
( MORE : Why Many Americans Feel
Like They’re Getting Poorer)
In addition to the Fed, central banks
around the world have engaged in
“globally synchronized asset purchase
programs,” Kaufman said, which
pumps more money into the system.
Other Numbers Matter More
Morningstar’s number-crunchers
take the price of each stock they
cover, divide it by what their analysts
think it’s worth, rank all of them and
take the median. (You can see the
current ratio in this chart here.)
Lately, it’s been pretty close to zero,
which indicates a more or less fair
value for the market in aggregate.
“The thing to focus on is price to fair
value ratio,” Morningstar’s Coffina
says. “Right now, our analysts think
the market is right about fairly
valued.”
The robust balance sheets of
corporations help justify high stock
prices. “I think the main positives for
the market have been relatively
strong corporate earnings,” Coffina
explains. “Companies have been able
to take advantage of high
productivity.”
Even so, high stock prices don’t
necessarily signify a strong economy.
“I think the market may be feeling
more strength than the consumer is
feeling,” Coffina says.
( MORE: Warren Buffett on
Berkshire’s ‘Subpar’ Year, Big-Game
Hunting and Why He Loves
Newspapers )
There are several other key data
points to consider. “The most
important metric people should be
looking at is employment, bar none,”
Goldberg says. “The second figure
everybody has to look at is inflation.
The third figure is bank lending.”
Following that advice gives you a
much more mixed bag concerning the
overall health of the economy:
Unemployment is stubbornly high,
inflation isn’t really an issue, and
bank lending looks encouraging.
We’re Not Out of the Woods Yet
Whether or not the market will
continue its upward march is
anybody’s guess. People get paid
huge amounts of money to figure it
out, and they still get it wrong more
often than not. Analysts like to point
out that it’s foolish to try to time the
market right, and that there are still
plenty of risks that could topple the
market’s ascent.
“You have to trust [Federal Reserve
chairman Ben] Bernanke and
company to thread the needle and
pull back on their easing policies
without disrupting the domestic
economy,” Goldberg says.
As Warren Buffet pointed out on
CNBC on Monday, the economy could
be rattled when this happens. ”There
are an awful lot of people who want
to get out of a lot of assets if they
think the Fed is going to tighten a lot,”
he said. Even if the Fed chairman can
get everything right, lawmakers could
still make a mess of things, between
dickering over sequester cuts and the
looming budget showdown coming at
the end of the month, analysts say.
( MORE: 6 Reasons Why the Stock
Market Could Do Surprisingly Well in
2013 )
Trouble could come from overseas,
too. Goldberg says bold moves by the
European Central Bank have
mitigated the threat of a cascade of
major bank failures, but an anemic
Eurozone economy would be bad
news for American export-driven
companies.
“Although Europe is not nearly as
significant a trading partner for the
U.S. as it used to be, it still is a
massive part of the developed world,”
he says. “If consumers and businesses
cut back, it hurts.
Wednesday, May 27, 2009
Macedonian Stock Exchange
Stock indices
Stock indices at the Macedonian Stock exchange include:
MBI 10 (Macedonian Blue Chip Index)
MBID (Macedonian Stock Exchange Index of publicly held companies)
OMB (Bond Index)
Madrid Stock Exchange
The Bolsa de Madrid was officially founded in 1831. As required by Spanish law, it is managed and operated by the Sociedad Rectora de la Bolsa de Valores de Madrid S.A., a corporation organized under the laws of the Kingdom of Spain. The membership of the Madrid Stock Exchange consists of 41 major financial institutions and 12 established securities dealers. At December 31, 2001, approximately 1477 domestic and foreign companies had their equity securities listed on the Madrid Stock Exchange. The total market capitalization of the equity securities listed on the Madrid Stock Exchange at May, 2007 was €1,276.26 billion
Madras Stock Exchange
In 1996, the MSE was fully computerised and online trading became operational, as the MSE was connected to 120 broking offices in and around Chennai through Wide Area Networking.
The MSE has about 120 live members and 1,785 companies listed. The exchange follows the Rolling Settlement system, as per the January 2000 SEBI (Securities Exchange Board of India) Guidelines and a proactive Grievance Cell is operational. By this system, investors can log in their complaints, for which a number will be given for further reference, through which investors can keep track of the action taken by the exchange as regards their complaint.
A subsidiary company - MSE Financial Services Ltd, has been established. A member of the Bombay Stock Exchange, MSE Financial Services will help create greater broker and investor flexibility through multi-market access. Hereafter the members will be able to trade in both BSE and MSE. This will be followed up with National Stock Exchange (NSE) membership.
Lahore Stock Exchange
Lahore Stock Exchange (Guarantee) Limited came into existence in October 1970, under the Securities and Exchange Ordinance, 1969, of the Government of Pakistan in response to the needs of the provincial metropolis of the province of Punjab. It initially had 83 members and was housed in a rented building in the crowded area of Bank Square in Lahore. The number listed companies has increased to 519 since its inceptopn.With 37 sectors of economy and 519 listed companies with total capital of Rs. 555.67 billion having market capitalization of around Rs. 3.64 trillion . LSE has 152 members of whom 81 are corporate 54 are individual members.LSE was first stock exchaneg of pakistan which used internet and currently 50% of its transactions are done on internet.
Lahore Stock Exchange has opened branches in the industrial cities of Faisalabad and Sialkot for trading. The Sialkot branch is referred to as "Sialkot Trading Floor".
London Stock Exchange
Its current premises are situated in Paternoster Square close to St Paul's Cathedral in the City of London.