USA stock market daily report by Millenium Traders (August 13, 2009, Thursday) 

After two months of gains retail sales reports show a drop of 0.1% in July compared to a gain of 0.8% in June, economists expected a rise by 0.6%. Sales excluding automobiles and auto parts reported an unexpected drop of 0.6% after a gain of 0.5% in June, economists were predicting a gain of 0.3%. Retail king "Wal-Mart" posted a surprising loss of 1.2% in second-quarter same store sales, however shares of Wal-Mart continued to gain, rising 88 cents per share for the quarter. Departments store sales fell 1.6%, including Target, who posted a decline of 0.6%, which is a little surprising after Macy's released they made profits in the second quarter "Consumers continued to maintain a tight hold on their wallets, worried about rising unemployment, falling home prices and tight credit," Steven Wood, president of Insight Economics, told Bloomberg News. "Overall economic activity will not fully revive until consumer spending rebounds." More bad news was reported when the Labor Department released that jobless claims rose by 4,000 to 558,000 week ending August 8th, experts expected claims to fall to 543,000. Although jobless claims reports were not so uplifting, the number of people continuing to collect benefits fell 141,000 to 6.2 million week ending August 1st to it's lowest level since April. 

  

Indian stock market daily morning report by Keynote Capitals (August 14, 2009, Friday) 

Discussions on new tax code, strong global cues and a strong recovery in industrial production helped the Sensex gain almost 500 points yesterday. The markets continued to strengthen after the announcements that Germany and France reported positive GDP. High beta real estate, banks and metals stocks led the rally, while recent outperformers IT and pharma stocks saw lackluster buying. Asian markets opened strong today as well. However, they are seen correcting on profit taking. We expect a positive opening for the Indian markets today following cues from the Asian markets. Weak monsoon may however impact the sentiment; traders and investors may try to book profits at higher levels, today being the last day of the week. Commerce and Industry Minister said that India's economy can achieve the same level of growth in FY10 seen a year earlier in spite of worsening dry conditions that threaten to dent its nascent recovery. He expects that the economy would achieve 6.7% growth. 

  

World stock markets daily report (August 14, 2009)

So when did the US market ever start caring about Europe where allegedly the recession is over. Odd that it sure doesn’t feel like a Renaissance on Main Street. US Retail sales (yes the US consumer is still approx 70% of the economy) were a total disaster, jobless claims jumped and foreclosures are a record high, but yet the market ended up because of “better than expected” earnings from Wal-Mart and legendary investor John Paulsen taking a stake in Bank of America and Regions Financial. Downright perverse. The decoupling of the market from the real economy seems to be at all time highs. The S&P500 closed up 0.7% to post a new cyclical high, led by the building materials and financial sectors. Commodities, especially the base metals, also traded positively, with the price action there continuing to diverge from that suggested by the likes of the Baltic Dry Freight Index (now down for 10 sessions in a row). 

HOT STOCK

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8/14/2009 †Company Name
Price
Change / %Change
ARCC
Ares Capital Corp
The investment company said it’s offering to sell 8 million shares and plans to use part of the money to pay debt.
9.22
-0.49 / -5.05%
BA
Boeing Co
The plane maker stopped production at a 787 Dreamliner facility in Italy that was making parts of the plane's fuselage, The Wall Street Journal reported. Its subcontractor, Alenia Aeronautic in Naples, stopped work two months ago after structural flaws were discovered at where the wing and the fuselage meet.
44.87
-1.75 / -3.75%
BKS
Barnes & Noble Inc
The largest U.S. bookstore chain was cut to “underperform” from “neutral” by Credit Suisse Group AG, which said the company’s decision to buy back Barnes & Noble College Booksellers Inc. increased risk and eliminated free cash.
20.87
-2.11 / -9.18%
GNW
Genworth Financial Inc
The life and mortgage insurer that failed to get a U.S. bailout was downgraded to “sell” from “hold” by Citigroup Inc., which cited “a very uncertain earnings outlook and capital position.”
8.28
-0.47 / -5.37%
GRRF
China GrenTech Corp Ltd
The wireless products and services company reported second- quarter profit of 8 cents a share, four times the average analyst estimate.
5.97
+1.91 / +47.04%
JCP
JC Penney Co Inc
The discount department store chain swung to a second-quarter loss of $1M, or break-even on a per-share basis, compared with a profit of $117M, or 52 cents a share, in the year-earlier period. Sales fell 7.9% to $3.94B and same-store sales dropped 9.5%.
31.29
-2.05 / -6.15%
JWN
Nordstrom Inc
The upscale department store operator’s second-quarter net income fell to $105M, or 48 cents a share, from $143M or 65 cents a share, in the year-ago period. Net sales for the quarter fell 6% to $2.14B as same-store sales fell 9.8% from a year ago.
27.87
-1.89 / -6.35%
TKTM
Ticketmaster Entertainment Inc
The ticket broker’s second-quarter profit fell to $6.9M, or 12 cents a share, from $23M, or 41 cents a share, in the year-ago period. Revenue fell to $355.1M from $382.4M.
8.92
-0.85 / -8.70%

US Markets
Actives
Gainers
Losers
Widely held
Dow 30
Aug 14 9:14am †
Change
%Change
Level
Dow
-13.00
-0.14%
9,321.00
NASDAQ
-16.75
-1.03%
1,615.00
S&P
-7.70
-0.76%
1,005.80
DJ Totl Mkt
-103.08
-0.99%
10,333.27
Russell 2000
-11.29
-1.96%
563.90
Philadelphia Semiconductor
-7.71
-2.55%
294.65
Dow Transports
-68.20
-1.81%
3,705.92
Dow Utilities
+0.71
+0.19%
373.07
NYSE Composite
-66.28
-1.00%
6,537.82
AMEX Composite
-16.33
-0.96%
1,686.85
Morningstar Index
-23.77
-0.95%
2,479.54
*10yr Note
-0.3300
-0.092%
3.558%
*NYMEX Crude Oil
-3.01
-4.46%
67.51
Gold
-7.80
-0.82%
948.70
Open Market Closed Pre-Market *as of previous close

Sepa orders DHA to stop new scheme development

KARACHI: The Sindh Environmental Protection Agency (Sepa) has asked the Defence Housing Authority not to create third party interests or to initiate any development work in it’s recently launched residential-cum-housing scheme without seeking environmental clearance from it first.

Sources in the provincial environmental watchdog said that the newly appointed Director-General of Sepa, Naeem A. Mughal, in an official letter, had informed the administrator of the DHA that the authority had so far not submitted any environmental impact assessment report to Sepa regarding the commencement of a major development project off the Superhighway, but started inviting applications from the general public, which was tantamount to violating the provisions of the Pakistan Environmental Protection Act, 1997.

They added that the DHA had been asked to submit its response to Sepa in writing by Aug 8, 2009, regarding the status of the project and also to refrain from initiating any development projects on the land without prior approval of an EIA report, which was supposed to be submitted long before the launching of any project.

According to DHA communications, the authority had started offering plots of various sizes, ranging from 200 to 2,000 square yards, for residential and commercial purposes in its proposed DHA City, spread over an area of about 12,000 acres of land having a four-kilometre frontage on the Superhighway, located in the proximity of the upcoming ‘Educational City’.

Environmental rules make it mandatory upon the owners and sponsors of projects like expressways, bypasses, major roads, housing schemes, bridges, water supply projects, oil and gas exploration projects, power plants, desalination plants, industrial waste treatment plants, industrial, chemical and manufacturing plants, commercialisation projects for roads and residential plots or installation of fuel stations to make sure that no environmental hazards are involved.

For the purpose, the environmental impact assessment is undertaken before allowing execution of such projects, and, according to the environment laws of the country, the relevant government agencies are required to thoroughly review a proposed project right from the time it launches it to when it finally becomes operational.

However, conservation activists have been observing that while agencies appear not as active as they should be, the higher authorities seem lacking in the will to make certain that no mega-project is allowed to be executed without undergoing such an assessment and getting clearance as per the environmental rules.

A source said that not too long ago Sepa was badly criticised for holding public hearings, as part of the EIA proceedings, for a steel plant and a flyover which was already under construction.

Sepa DG Mughal told Dawn that under new initiatives aimed at enforcement and increasing effectiveness of environmental laws and relevant organs, his agency had now decided to issue letters and notices to all concerned and executers of mega-projects and housing schemes, as these needed to be examined for their environmental and social impact and adaptation of mitigation measures right from the construction stage and during the operational phase of the projects.

‘My attention has been drawn to the DHA City project as well, and I feel that development of such a big city on virgin land involving the existing resources, human and wildlife, flora and fauna, hydrology, energy, natural drainage and rain encatchments and land use, needs to be minutely judged in line with the PEPA,’ Mr Mughal said, adding that he had asked the proponent in question to furnish an EIA report pertaining to the project at the earliest.

He said that he had gone through the DHA advertisements and other relevant information and sent a letter to the housing authority drawing its attention to the fact that it was required to fulfil all legal requirements as envisaged in Section 12 of the Pakistan Environmental Protection Act 1977 as well as relevant portions of the Pakistan Environmental Protection Agency Regulations, 2000.

Section 12 of Pepa states that no proponent of a project shall commence construction or operation unless he or she has filed with the federal/provincial agency an initial environmental examination or, where the project is likely to cause an adverse environmental effect, an environmental impact assessment has obtained from the federal/provincial approval in respect thereof.

Foreigners flock back to Karachi Stock Exchange

KARACHI: Foreigners are flocking back to the Pakistani equity market in search of value investing.

In the first two trading days this week, overseas investors were net buyers of Pakistani equity to the tune of $10 million. Figures released by the National Clearing Company of Pakistan (NCCPL) showed that on Tuesday offshore investors bought stocks worth $8.2 million (Rs669 million) and sold them valued at $1.28 (Rs104 million), resulting in net buy of $7 (Rs564 million). Net foreign buying on Monday stood at $ 2.6 million.

There is a visible change of heart on the part of foreign investors reflecting in the gathering momentum on portfolio investment.

For the previous two months (June-July), net foreign buying had aggregated to just about $18 million. But things were worst before.

Foreigners who scrambled for the exit door after the ‘freeze or floor’ was removed, stood out as net sellers of a huge $250 million worth of shares in the five months from January to May.

Mohammad Sohail at Topline Securities Pakistan says ‘net purchase of $18 million (for June, July) is relatively small considering huge inflows in other emerging markets, but the trend has provided some stability to local equities that posted a gain of 7.8pc in the outgoing month.’

Sajid Bhanji at Arif Habib Limited commented that there was possibly a change of perception towards country risk. Investors abroad were realising that Pakistan was after all, not going to go bust. The developments on the IMF funding front were encouraging and investors were entering the equity market to seek the first mover advantage.

He said that worldwide commodity play had started with oil prices pushing forward.
Sohail at Topline said that foreign portfolio investment in Pakistani capital market was steady but gradual, compared to the huge sums flowing in from US and Europe to all the emerging markets where bulls were already on the rampage.

‘A record net inflow was witnessed in emerging markets in the recent past led by China, India and Brazil. In the last two months, Mumbai Exchange saw an enviable inflow of $3.1 billion,’ says Sohail.

He said that in case things go through well with IMF in regard to the next tranche and going forward the country’s request for additional funding was given a patient hearing by the international lending agency, Pakistan stood a good chance of making back to the ‘emerging market MSCI index,’ from which it was downgraded to the less prominent MSCI ‘Frontier markets index.’

But in all that, there was one disconcerting element: The pressure on the Rupee. A stock broker said that some of his old foreign clients were reluctant to seek entry into the equity market until they were sure of the stability of the currency.

‘No one putting their money in dollars wants to make an incalculable loss,’ he said, but he offered comfort with the words: ‘Rupee will stabilise once the IMF funds flow in.’

He suggested that the undervalued, high yield stocks, could receive another boost, if the upcoming Monetary Policy Statement were to stipulate interest rate cuts in line with market expectations.

There have been no firm figures of total foreign portfolio investment in the country, but most brokers see a number rounding off to about $1 billion.

The influence of the off-shore equity investment in local market was thought to be growing, but some of old timers who have seen decades of entry and exit of ‘hot money’, are not much enthused.

‘Everything is subject to the whims of the foreign fund managers,’ says a stock broker. ‘The foreign portfolio investment exits as quickly as it enters,’ the broker commented and added: ‘It is good to see them flocking in, but when they migrate, all that they leave behind is a wasteland.’

Islamabad Stock Exchange Towers

The Islamabad Stock Exchange (ISE) was incorporated as a guarantee limited Company on 25th October, 1989 in Islamabad Capital territory of Pakistan with the main object of setting up of a trading and settlement infrastructure, information system, skilled resources, accessibility and a fair and orderly market place that ranks with the best in the world. The purpose for establishment of the stock exchange in Islamabad was to cater to the needs of less developed areas of the northern part of Pakistan.

The ISE Towers comprise twin 22 storey towers with unique and inspiring amenities, offer futuristically and aesthetically designed offices with panoramic views, is being constructed over a piece of land measuring 5600 square yards in the heart of Islamabad at Jinnah Avenue (Blue Area) which is the hub of all business and commercial activities in Islamabad. The building is facing 400 feet wide Jinnah Avenue on one side and has another entrance from 100 feet wide Nazimuddin Road, besides breathtaking scenic view of the Margalla Hills and the city from the building.