Saturday, 8 September, 2012

KARACHI

STAFF REPORT

The price of Brent Crude best known asblack gold has skyrocketed to a meager1% during CY12TD as compared to CY11average price of $111.8.However, phenomenal rise has beenwitnessed in the price of thecommodity during the month ofAugust-12, as both Brent Crude andWTI have soared by 10% and 7%,respectively. “This is mainly due to theUS inventory numbers that fell in theaftermath of hurricane Isaac,” viewed

the analysts at InvestCap Research.The said hurricane, they said, had leftmore dent on the US than first feared,and now the world is expected to feelthe heat in the shape of rise in the pricesof crude oil. The hurricane, whichoriginated from the Gulf of New Mexico,the hub of US refinery and oilproduction, caused inventory slippage of7.4 million barrels against forecast of 3-5 million barrels.Consequently, the Aug-12 endinginventory levels reached the lowestposition in the preceding two years.“Now as the natural phenomenon has

subsided, we expect additional buyingto come in from the US as the countryaims to up the level of its oil stocks,”the analysts said.In addition to upping the oil inventory,the analysts expect better US job datacoupled with ‘unlimited’ bonds purchaseby the European Central Bank (ECB) areexpected to positively influence thedemand of crude oil, thus prices areexpected to remain on the higher side.During the month in review, goldposted a significant growth of2.3%MoM rising to $1692/oz.Europeans are opting for Gold as a safe

haven for their precious investment.At the same time Silver is also followingthe trend as it surged by 5.5%MoM toreach at $29/oz in Aug-12.The reason behind the increase inprecious metal prices is predominantbuying on the back of seasonal jewelrydemand from India and China.The gold is attracting investors’interest as the uncertainty regardingthe recession in Europe is expected tosubside after the ECBs announcementthat the policymakers had agreed toan unlimited bond-purchase programto help stabilize the European region.

It has recently touched $1,709/oz. inthe int’l markets.On the other hand, silver also rose to itshighs of $32.62.89/oz.“We predict gold will rise further as thedemand from Europe (investing in thecommodity) coupled with buying fromChina, India and Russia to keep thedemand for gold high. Therefore, weforesee the gold to touch 1,750/oz in thenear future, while silver is also expectedto follow the same trend as it consideredthe alternate for gold in investment andin consumption for jewelrymanufacturing,” said the analysts.

asian BondmarkEt raisEs$4.7 trillionin a dEcadE

ISLAMABAD

ONLINE

The Asian Development Bank

(ADB) has said that the local

currency (LCY) bond market of

emerging East Asia (EEA) has

risen from approximately $1

trillion in 2001 to $5.7 trillion

as of end 2011.

In its latest Report issued on

Friday, ADB said the total LCY

bonds outstanding in EEA at the

end of September 2011 were

approximately 8.1 per cent of

the global bond market against

2.1 per cent in 1996.

It said the domestic corporate

bond market has been the

growth driver for the EEA LCY

bond market as a whole over

the past few years and

accounts for about a third of

total bonds outstanding in the

region. The largest LCY bond

market in EEA is the People’s

Republic of China with $3.4

trillion in bonds outstanding at

end 2011.

The Republic of Korea,

Malaysia, and Thailand had the

most liquid government bond

markets – as measured by

quarterly turnover ratios – at

the end of 2011.

The Bank further said to

mitigate against the risks

associated with the sudden

reversal of capital inflows, and

to minimize the currency and

maturity mismatches, ASEAN+3

governments launched the

ASEAN+3 Asian Bond Market

Initiative in 2002 to foster the

development of local currency

bond markets.ASEAN+3, with

an ADB contribution, has

established the Credit

Guarantee and Investment

Facility to provide credit

enhancement for investment

grade companies seeking to

issue local currency bonds.

ISLAMABAD

ONLINE

IN order to lure the

International Strategic

Investors to invest in the

local Stocks exchanges; the

Securities and Exchange

Commission of Pakistan (SECP) has

proposed the merger of all three

stock exchanges into one brokerage

center with merge trading. The

SECP Chairman while talking to

media on Friday at the SECP House

said that the proposal has been

given to the representatives of the

all three stock exchanges which will

be implemented with their consent.

He said that the capital gains tax

(CGT) will be implemented on the all

three stock exchanges from the next

week after the CGT rules would be

notified by the Federal Board of

Revenue (FBR) after which the

National Clearing Company of

Pakistan Limited (NCCPL) would

start deducing the tax. The SECP

Chairman said that the CGT law

has been in place. The Law and

Justice Division has vetted the

CGT rules and FBR will notify

the same in coming days. The

National Clearing Company of

Pakistan Limited (NCCPL) would

not be in a position to deduct the

CGT unless or until the CGT rules

are not being implemented. As

soon as the CGT rules would be

notified by the SECP, the NCCPL

would start deducing the tax on

stock market transactions. The FBR

will publish the draft CGT rules for

the information of all persons and

draft will be taken into consideration

after 15 days of its publication in the

official Gazette. The CGT rules would

be analyzed by all the stakeholders

and any suggestion, which may be

received from any person, in respect

of the said draft shall be considered

by the Federal Board of Revenue.

Responding to a query, Muhammad

Ali said that the CGT exemption is

not available on the stock market

transactions. This would be further

clarified in the CGT rules to be

notified by the Board. SECP

Chairman was confident that the

implementation of the CGT rules

would have a positive impact on

the market as these rules would

bring clarity in the procedure for

the collection of the CGT

transactions. A difference in

investment would be visible after

implementation of the CGT rules

and interest of the overall

investors would be increased in

view of a clear procedure on the

said issue. The stock market is

waiting for the CGT rules to have a

clear implementation procedure

on the stock market transactions,

he added.

oncE WE mErgE,thE World Will sPlurgEmErging stockExchangEs WouldattractintErnationalinvEstmEnt inlocal markEt: sEcP

ISLAMABAD

ONLINE

The Global Competitiveness Report (2012-2013) issued by

the World Economic Forum has appreciated the performance

of the Securities and Exchange Commission of Pakistan

(SECP). Consequently, the SECP has been ranked 55, as

compared to 70 last year. This acknowledgment by the World

Economic Forum gives us immense pleasure, the SECP

chairman, Muhammad Ali along with Amir Jahangir, CEO

MISHAL Pakistan told journalists on Friday. We have taken

many initiatives and we are really glad that our performance

has been internationally recognized and appreciated, he said.

Elaborating on the SECP’s recent initiatives, Ali said that the

demutualization of stock exchanges has been achieved. It

will lessen the conflicts, which were found in the mutualized

set-up where the brokers enjoyed rights of ownership,

decision-making and trading. It will support enhanced

governance and transparency at the stock exchanges and will

bring about greater balance between the interests of various

stakeholders. The capital market investor education and

awareness program was launched in July 2012. It is aimed at

making people aware of various financial products and

understanding their rights and responsibilities to enable

them to make informed investment decision. The revised

Code of Corporate Governance was launched in April 2012.

And a similar code for the state-owned enterprises is being

finalized. Since May 1, 2012, functional websites have been

made mandatory for the listed

companies. In May 2012, the SECP

was elected to the executive

board of the International

Organization of Securities

Commission (IOSCO), said Mr.

Ali. Set up in 1983, the IOSCO

is a Madrid-headquartered

organization with 182

members. The SECP

introduced and

implemented the concept

of e-IPO. New takaful

rules have also been

issued. New equity,

derivatives products

and commodity futures

contracts, i.e., exchange

traded fund, index options,

futures contract in sugar and crude

oil has been introduced.

World Economic ForumacknoWlEdgEs sEcP

Commodity prices surge in August

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02

Saturday, 8 September, 2012

Major Gainers

comPany oPEn high loW closE changE turnovErUniLever PakXD 8800.00 9240.00 9240.00 9240.00 440.00 120Unilever FoodXD 3123.00 3269.00 3269.00 3269.00 146.00 20Island Textile 295.70 310.47 290.00 305.00 9.30 1,400Service Industries 184.16 193.36 185.00 193.24 9.08 74,600Pak Gum & Chemical 237.44 247.99 235.00 245.95 8.51 5,300

Major LosersColgate Palmolive 1350.00 1350.00 1322.00 1325.00 -25.00 400National Foods 262.63 260.00 249.50 249.50 -13.13 4,100Shezan Inter. 242.60 233.00 231.00 231.67 -10.93 500Shield Corpor 161.76 153.68 153.68 153.68 -8.08 500Mithchells Fruit 357.00 349.00 349.00 349.00 -8.00 100

Volume Leaders

Telecard Limited 2.76 3.74 2.81 3.45 0.69 50,253,500WorldCall Telecom 3.04 3.50 3.10 3.24 0.20 31,045,000P.T.C.L.A 19.57 20.57 19.64 20.57 1.00 21,568,500Engro Corporation 105.46 110.50 105.51 109.90 4.44 8,940,300D.G.K.Cement 49.31 50.85 49.00 49.53 0.22 8,757,500

Interbank RatesUS Dollar 94.6342UK Pound 151.0740Japanese Yen 1.1987Euro 120.0245

Dollar EastBuy sEll

US Dollar 94.50 95.00Euro 118.68 119.66Great Britain Pound 149.58 150.79Japanese Yen 1.1852 1.1947Canadian Dollar 95.36 96.63Hong Kong Dollar 12.00 12.17UAE Dirham 25.63 25.81Saudi Riyal 25.10 25.26

Australian Dollar 96.19 98.42

Business

hEc’s sending off ceremony for students

ISLAMABAD: The contribution of Higher Education Com-mission Pakistan HEC is really commendable and govern-ment of Pakistan shall continue to support and back varioususeful initiatives of HEC. It was stated by Deputy ChairmanPlanning Commission Pakistan Dr. Nadeem-ul-Haq at thesend-off ceremony of Pakistan scholars proceeding for highereducation at Cambridge University UK. PRESS RELEASE

hEc’s 19th mt-FPdP commences ISLAMABAD: Under the auspices of Higher Education Com-mission (HEC) Learning Innovation Division the 19th MasterTrainers-Faculty Professional Development Program (MT-FPDP)commences here at HEC head office Islamabad. The course wouldbe completed on October 25, 2012 which is being attended by 28faculty members from 24 public sector universities across Pakistan.So far 524 Higher Education faculty members have been benefit-ted from Master Trainers-Faculty Professional Development Pro-gram (MT-FPDP) in 18 MT-FPDP batches. PRESS RELEASE

second skin launchedLAHORE: Second Skin, aclothing line based on semi-for-mal and formal designs, recentlylaunched at Object’s flagshipstore at Park Towers. While Ob-ject is essentially a store for homeaccessories and furniture, it hasrecently started branching outinto clothes but this is the firsttime the store has launched theirown fashion label. “Second Skincaters to evolution,” says AdilSartaj, CEO of Object who is alsothe head designer behind SecondSkin. “This line caters to modern,fashion forward women who are interested in making a simple butelegant statement through their wardrobes.” PRESS RELEASE

CORPORATE CORNER

KARACHI: Participants at the opening ceremony of the Association ofSchool Rowing in Asia (ASRA) Regatta 2012 held at Karachi Boat Club.

HONG KONG

AFP

ASIAN markets surgedFriday after EuropeanCentral Bank chief MarioDraghi unveiled a plan to

buy the bonds of troubled eurozonenations in a bid to tackle the re-gion’s long-running debt crisis.

The bullish sentiment fuelledby Draghi’s announcement was in-creased by US data showing manymore jobs than expected were cre-ated in the private sector lastmonth, lifting hopes for the world’snumber one economy.

Tokyo surged 1.75 percent bythe break, Hong Kong jumped 1.81percent, Shanghai rose 2.00 per-cent, Sydney gained 0.58 percentand Seoul rallied 2.10 percent.

Draghi said Thursday the ECBwould buy unlimited amounts ofdebt from troubled nations such as

Spain and Italy in order to lowertheir cost of borrowing and helpthem get back on their feet — ascheme named “Outright MonetaryTransactions”.

The OMTs “will enable us toaddress severe distortions in gov-ernment bond markets which orig-inate from, in particular,unfounded fears on the part of in-vestors of the reversibility of theeuro”, Draghi said.

“We will do whatever it takes” tokeep the eurozone together, headded. However, he said the pur-chases would depend on those coun-tries asking for bailout cash andagreeing to undertake economic re-forms. The announcement “ex-ceeded market expectations, whichhasn’t happened for a long time,”said Dariusz Kowalczyk, senioreconomist and strategist at CreditAgricole in Hong Kong. “It draws aline, for a while at least, under the

issue of peripheral European debt,”he told Dow Jones Newswires.

The euro rallied in New Yorkafter the news, surging to a two-month high of $1.2652 at one pointbefore ending Thursday at $1.2629.

In early Tokyo trade it bought$1.2631. It also rose to 99.64 yenin Tokyo, from 99.60 yen lateThursday. Before Draghi’s planthe common currency fetched$1.2629 and 99.05 yen. The dol-lar also rose Friday, to 78.89 yenfrom 78.85 yen late Thursday. Inthe United States figures frompayrolls company ADP Thursdayshowed private-sector employ-ment rising by 201,000 in Au-gust, after an upwardly revisedJuly gain of 173,000.

The jobs number was wellabove the average forecast of143,000, and showed a strong in-crease of 29,000 in the key servicesector from July, to 185,000.

Also lifting sentiment were fig-ures from the Institute for SupplyManagement Thursday showing itsmonthly purchasing managersindex for the services sector rose to53.7 from 52.6 in July, scotchingworries of a downturn. A readingabove 50 indicates growth.

On Wall Street the Dow climbed1.87 percent and the S&P 500 ad-vanced 2.04 percent — both to theirhighest levels since December 2007.The Nasdaq surged 2.17 percent.Eyes are now on non-farm payrollsdata to be released later Friday,which traders said were also “point-ing to quite a strong read as well”.

New York’s main contract, lightsweet crude for delivery in Octoberslipped 76 cents to $94.77 a barreland Brent North Sea crude for Oc-tober delivery shed 81 cents to$112.68. Gold was at $1,692.75at 0250 GMT compared with$1,708.24 on Thursday.

Asian markets sharplyhigher after ECB move

ISLAMABAD

ONLINE

Islamabad Chamber of Commerce and Indus-try (ICCI) and Association of Certified Char-tered Accountant (ACCA) signed aMemorandum of Understanding (MoU) on Fri-day. The MoU will equip both institutions towork together to achieve and promote thehighest professional, ethical and governancestandards, advance the public interest and tosupport the accounting profession and busi-ness community by building both capacity andcapability. The agreement was signed by YassarSakhi Butt, President ICCI and Shamez Mukhi,Head of Public Affairs ACCA Pakistan.

Speaking on the occasion, President ICCIsaid that the partnership between ICCI andACCA would serve to mutually benefit the busi-

ness community and the accountancy profes-sion at large. ACCA’s work on the Research andInsights front has been remarkable whichwould enable us to strengthen relationshipswith the business community further, he added.Yassar Sakhi Butt said that Government shouldensure development of a comprehensive Infor-mation Communication technology (ICT) infra-structure in the length and breadth of thecountry along with opening of training insti-tutes throughout Pakistan for providing train-ing to entrepreneurs on specially discountedpackages so that majority of businessmen couldbe well trained to utilize ICT for bringing im-provement in all functional areas of their enter-prises and promoting businesses.

Shamez Mukhi, Head of Public AffairsACCA Pakistan said that ACCA Pakistan eagerlyseeks to create synergies with regulators like

ICCI. He said that we seek value addition forbusiness enterprises and our members to en-able them achieve effective outputs and out-comes. This partnership between ICCI andACCA Pakistan is unique and may prove to becornerstone for other similar progressive initia-tives, he maintained.

Following the signing ceremony, ACCA Pak-istan and ICCI also organized a session on‘Transforming Finance Function to e-Profes-sional’. Muhammad Uzair, Director InternalAudit, Tourism Promotion Services (Ltd) spokeon e-learning and e-assessment practices, offer-ing solutions to create a better learning experi-ence, as well as developing more challenging andrealistic tests of skills and competences. KomailAbbas Badami, Partner Badami Law Associates,and Member, ACCA Pakistan Members NetworkPanel conducted a workshop on e-filing.

icci, acca sign mou for collaboration

TOKYO

AFP

The euro notched up further gains in Asia onFriday after jumping overnight on the EuropeanCentral Bank unveiling a bond-buyingprogramme to help debt-ridden members of the17-nation eurozone. The common currencybought $1.2631 and 99.64 yen in Tokyo morningtrade, from $1.2629 and 99.60 yen late Thursdayin New York. The euro had climbed to $1.2652, atwo-month high, earlier in the US session. It hadbeen trading around $1.2602 and 98.85 yenbefore the bank’s announcement. The dollar alsorose in Tokyo to 78.89 yen from 78.85 yen onThursday. The plan, mapped out by ECB chiefMario Draghi after the bank announced anunchanged interest rate policy, offeredhope that efforts to strengthen theeurozone were comingtogether. Traderswelcomed details ofthe programme. “TheECB meeting hashelped stabilise theeuro,” Daisaku Ueno,senior foreign exchangeand fixed incomestrategist at Mitsubishi UFJMorgan Stanley, told DowJones Newswires. But it was notimmediately clear if debt-hit nationsincluding Italy and Spain would takeadvantage of the ECB offer, whichamounts to a bailout. The move wasaimed at bringing down debt-hiteurozone members’ borrowing costs andprop up the embattled euro. But critics led by

Germany had warned that buying the debt oftroubled eurozone nations would let them avoidpainful austerity cuts that are crucial to repairingtheir fiscal health. Currency markets would nowshift their focus to US non-farm payrolls datalater in the day, a strong barometer of whetherthe US Federal Reserve decides to launch freshstimulus. The dollar’s gain on the yen washelped by figures on Thursday that showed USweekly jobless claims fell for the first time in amonth while a better-than-expected 201,000private-sector jobs were added to the world’sbiggest economy in August. On Friday, Japan’sgovernment said it would delay 5.0 trillion yenin spending ($63 billion) amid a politicaldeadlock over a bond-issuance bill necessary to

help pay for some ofTokyo’s public

spending thisyear.

crude down inasia overdemand concerns

SINGAPORE

AFP

Oil prices sank in Asia Friday, with de-mand concerns in the spotlight despite theEuropean Central Bank’s plan to supportweak eurozone economies, analysts said.

New York’s main contract, light sweetcrude for delivery in October slipped 76cents to $94.77 a barrel and Brent NorthSea crude for October delivery shed 81cents to $112.68.

Concerns over global energy demandfollowing a slew of manufacturing datashowing weakening activity in China, Eu-rope and the United States overshadowedthe ECB plan to buy sovereign bonds, saidJustin Harper, market strategist for IGMarkets Singapore.

“While ECB moves to solve the euro-zone crisis are welcome and saw equitiesrally... energy markets continue to beweighed down by weak economic data,”he told AFP.

“Manufacturing data has been weakand that shows the economy is still verysluggish and will keep a cap on oil prices,”Harper added.

Traders were also disappointed afterpositive US jobs data released lateThursday suggested the Federal Reservewould likely delay any moves to intro-duce another round of stimulus meas-ures, Harper said.

Traders are now looking ahead to therelease of non-farm payrolls data later Fri-day for more clues about the state of theworld’s leading oil consumer, he added.

Euro stronger in Asiaafter eurozone bond plan

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