KARACHI STOCK MARKET NEWS

News : The Sindh government and Engro Power Generation Limited on Tuesday signed an agreement for mining and generating 600-1000 megawatts power from Thar Coal fields on a public-private-partnership basis. The agreement was signed by Aijaz Ali Khan, Secretary Mines and Mineral Development on behalf of Sindh Government and Asad Umer, CEO Engro Ltd and Khalid Mansoor, CEO Engro Power Generation….Under the agreement Sindh Government will make 40 percent and Engro will make 60 percent investment. The project envisages 600 to 1000 MW electricity and 2 percent of the profit would be spent on the welfare of local population. The project feasibility will be completed in 18 months…. Aaj News

MCB Bank Limited joined hands with Adamjee Life to offer Bancassurance products to MCB customers. Through this newly formed alliance, MCB will act as a distributor of Adamjee Life products to its customers, President MCB, Atif Bajwa said.He said in turn MCB’s association with Adamjee Life would facilitate the bank to meet such customer requirements… Daily Times

Market Low : 8,794.07  High : 8,943.39

The market lost 1.8% today, sliding further downwards towards 5,557. It will probably remain shaky till all the political bullshit subsides.

News :  The insurance business has declined by 30 percent in the country due to slowing down of economic activities in the recent global recession. The international re-insurers have cut the rates of commission of local insurance companies, while on the other hand the 5 percent increase in the CED to 10 percent had put an extra burden on the insurance business...Aaj News

Market Low : 5,552.90  High : 5,718.85

Market Close : 5,557.92 : 104.10 points down

The Karachi Stock market had a successful week boosted by corporate results and the news of its possible re-inclusion in the MSCI Frontier Index. Successfully breaking 6,000 this week, the market took a breather and witnessed profit taking by Friday’s close. Next week should see the market remain tight with results from Pakistan Telecommunication Company, Oil & Gas Development Company, Pak Oilfields, Hub Power,  and United Bank Limited.

Dividends :  The profit after tax of Habib Bank Limited (HBL) has increased by nearly 55 percent to Rs 15.614 billion translating into an earning per share of Rs 20.47 in the year ended December 31, 2008 as compared to PAT of Rs 10.084 billion and EPS of Rs 13.18 earned in the corresponding period in 2007… Aaj News

DG Khan Cement (DGKC) has announced its results for the first-half of financial year 2009 (1HFY09). The company booked profits of Rs127 million (earnings per share of Rs0.5) versus Rs330 million (EPS of Rs1.3) in 1HFY08, depicting a decline of 61 per cent.Despite a jump of 79 per cent in sales revenue on account of higher local cement prices and cement exports, profits remained under pressure largely due to a significant jump in administrative and financial expenses… The News

News : The committee on CFS agreed to phase out the CFS Mk-II product from the local bourses, it is reliably learnt. The high-level committee constituted by Securities and Exchange Commission of Pakistan (SECP) met here on Saturday and reviewed the CFS Mk-II in its entirety including risk management, eligible securities and margin requirement.The meeting was presided over by the committee head Shehzad Naqvi, CEO of the Royal Bank of Scotland (RBS). The committee representatives from the three stock exchanges, National Clearing Company of Pakistan Limited, Mutual Fund Association of Pakistan (Mufap), Pakistan Banks Association (PBA) and senior securities market professionals/stakeholders attended the meeting… the committee reviewed the CFS Mk-II and agreed to phase out this product with the approval of the apex regulator. The committee will meet again sometime next week to finalise a proposal, which would be sent to the SECP for approval….Aaj News

Insurance companies have been asked to recognise the impairment in valuation of investment as of December 31st, 2008 for the purpose of distribution of dividend. In a circular issued by Insurance Division of the (SECP), insurance companies are allowed to value investment in Available-For-Sale (AFS) category at the purchase price and treat the impairment in valuation, at the end of the year, as temporary for finalisation of accounts. However, the impairment has to be accounted @ 25 percent per quarter in 2009…. Aaj News

The KSE-100 index made a high of 11,173 , then dipped down to 10,979 and close up at 11,156. Total volume traded today was 111.9 million shares, still on the low side. Arif Habib Securities was the flavour of the day with 12.6 million shares traded. The market has closed above its first resistance of 11,100 and the next target is 11,400. The market is up by nearly 1000 points since Friday and after 4 days of green, there could be some weekend selling 2moro.

News : The authorities have decided at a meeting held on Thursday that Equity Market Opportunity Fund (EMOF) would be an Open-End Fund. The EMOF  launched from Friday (today) would be injected in stock markets under NIT management when market is under pressure…The initial size of fund was declared at Rs20 billion, but owing to its attractiveness of being an open-end fund, the size might inflate to any level. The general public would also be able to invest in this fund and the National Investment Trust (NIT) would be announcing its daily NAV value and dividends,…NIT would form a separate board to manage the fund. The board would be meeting at least after every six months or in case of emergency too. Initially, EOBI has confirmed to pool Rs3 billion; State Life Rs2 billion and Rs2 billion by National Bank, besides other financial institutions and banks would share rest of funds, sources said. This fund would be invested in KSE 100-share Index instead of KSE 30-share Index as was informed earlier. The fund would not be invested in more than 50 companies… The News

Malaysia’s Maybank is set to buy another 5 percent of Pakistan’s MCB Bank as early as next month, in a deal estimated at $218 million,…Malayan Banking Bhd, Malaysia’s leading lender, bought a 15 percent stake in MCB Bank, Pakistan’s top lender, for $680 million in May. That deal included a clause whereby Maybank was obliged to buy up to another 5 percent of MCB Bank shares within one year of the first transaction. The price for this stake was then agreed at Rs 490 per share, plus holding cost, with the total price not exceeding Rs 510 per share. “The deal is very much on, the talks have started, and if all goes well, it should materialise sometime in August,” said a source close to the transaction.
A spokesman at Maybank declined comment. A spokesman at MCB Bank said any stake purchase by Maybank would be in line with the previous agreement, but he did not give a time frame for the new purchase…. Daily Times

Adamjee Insurance is likely to announce profit after tax of Rs 2.7 billion (EPS Rs 26) for the first half of the current year compared to Rs 1.18 billion (EPS Rs 11.6) in the corresponding period of last year, a growth of 125 percent, says a research report…“Exceptional growth in 2Q2008 profitability would mainly be attributable to a one-time capital gain of Rs 2.7 billion on account of MCB sell-off deal,”…. Daily Times

The United Arab Emirates (UAE) has recently raised the cement price by 15 percent due to its rising demand, mainly benefiting Pakistani cement industry, sources said on Thursday. Pakistan is the major cement exporter to the UAE, as it fulfils around 70 percent of the total demand of the product in the Emirates.After the rising cement prices in the face of huge demand in UAE, analysts see Pakistan as a primary beneficiary to flood the Arab markets with its product. It is likely to receive huge cement export orders shortly, they said…Source : Aaj News

Upper Caps : BOP / AICL / NBP / UBL / MCB / DGKC / NML / ATRL

Market Low : 10,979.07 High : 11,173.77

Market Close : 11,156.68 – 138.18 points up