profit.com.pk Friday, 15 June, 2012

sbp hankers after economic solutions

KARACHISTAFF REPORT

The current rupee depreciationagainst the dollar is expected to bodewell for the margins for local textilemanufacturers during the outgoingFY12, observed the analysts at Invest-Cap Research.

However, they said, compared toregional textile exporting countries'currency depreciation, the Pakistanitextile companies were facing a soar-throat competition in margins term.

With PKR depreciation of4.1%YoY against USD during FY12,Bangladeshi Taka has depreciated bymassive 11%YoY while Indian Rupeealso declined by 10%YoY againstUSD.

“On the international front, com-paratively low depreciation of PKRagainst USD pose bit steady picturebut yet still fall on uncompetitive sidefor local textile industry,” viewedAbdul Azeem, an analyst at Invest-Cap. On both local and internationalfronts, cotton prices have declined by35%YoY and 32%YoY, respectively.The decline in prices at large will in-tend to keep the gross margins of tex-

tile margins stable at 16% this fiscalyear.

However as far as cotton produc-tion is concerned, local bumper cot-ton crop of 14.8mn bales has kept thecotton prices below Rs6000/maundin local markets during FY12. Whileon international front, cotton produc-tion is estimated to be at 123mn bales(1 bale = 480lb), increased by5.7%YoY till May 12 estimates accord-ing to U.S Department of Agriculture(USDA).

However, during the FY13, USDAhas estimated the cotton productionto decline by 5%YoY to 116.7mn bales;however with 4 years high endingstock of 66.9mn bales this year, cot-ton prices on international front areexpected to remain stable duringFY13.

With the stable margins going for-ward we recommend buy on NCL andNML with the target price for Dec-12Rs26/share and Rs62/share respec-tively.

The NCL is trading at PE multipleof 4.2x with dividend yield of 8.9% forFY13 similarly, NML is trading at PEmultiple of 4.7x with dividend yield of4.5% for FY13.

Chew your own tobacco! Page 02

KARACHISTAFF REPORT

GOvERNOR State Bank ofPakistan Yaseen Anwar hascalled upon the regional cen-tral bankers to fully under-

stand the nature of their economies andgo beyond the textbook approaches totackle today’s economic problems.

Inaugurating a three-day SAARCFI-NANCE Regional Seminar on ‘MonetaryPolicy Frameworks in the SAARC Re-gion’ at the National Institute of Bankingand Finance (NIBAF), Islamabad onThursday, he stressed upon the partici-pants to check the validity of basic as-sumptions while developing models foreconomic forecasts in view of the possi-bility of a breakdown in relationships be-tween key variables in the backdrop ofemerging economic realities. “We alsoneed to keep a close watch on the pulseof the economy, considering it is a livingand ever evolving organism,” he added.

Anwar said that a comprehensive un-derstanding of the economy is necessaryin order to correctly calibrate monetarypolicy, which may then achieve the objec-tives of price stability and economicgrowth. Anwar said sharing ideas and ex-periences at a regional forum will helpcentral bankers better understand the na-ture of their economies. He urged themto explore the ways by which monetarypolicy frameworks may be improvedthrough mutual and collaborative efforts.

SBP Governor said the targets set bycentral banks have an effect on the realeconomy and implications for price sta-bility. However, central banks’ policiesare more effective when they are inde-pendent of fiscal influence, have market

freedom and are time-consistent, hesaid, adding that the absence of theseconditions may reduce the efficacy oftheir (central banks’) policies. ‘The com-plexities of today’s world have createdchallenges for monetary policy and wemust occasionally toss conventional pre-

scriptions aside and seek customized so-lutions,’ he added.

Sharing his understanding on work-ing of different channels of monetarypolicy, Mr. Anwar disclosed that the realinterest rate channel in Pakistan is foundto be extremely weak during the times of

frequent price changes and high infla-tion. Quoting a recent study of SBP’s Re-search Department, he said that pricesare revised roughly every quarter in theeconomy. ‘Coupled with the fact thatPakistan’s economy has experienceddouble-digit inflation during the last 4

years, prices are very quick to adjust tochanges in monetary policy,’ he saidadding that a large part of inflation per-sistence in the country is due to sus-tained period of high inflation, which hasallowed inflationary expectations to in-cubate.

Mr. Anwar pointed out that the lend-ing channel appears to be quite robustand is the key channel through whichmonetary policy is transmitted to the realeconomy in Pakistan. Similarly, the roleof exchange rate channel has also gainedimportance over time due to liberaliza-tion of the foreign exchange market inthe country. SBP monitors the forex mar-ket very closely while considering the im-pact of changes in the exchange rate, headded. He observed that monetary policymay also influence inflation through ex-pectations channel.

SBP Governor said the transitionfrom understanding these channels todeveloping the proper mechanisms toimpact our objectives may not besmooth. ‘After all, we should concedethat there are some things that we haveabsolutely no control over in the short-run,’ he said, adding that policy makinghas become a difficult task in recenttimes.

He observed that the complexity andthe uniqueness of our economy only em-phasize the need to develop a thoroughgrass-root understanding of the econ-omy, and a customized toolbox to dealwith the multiple challenges along theway. ‘We have moved towards a betterunderstanding of our economy and we’vemade some significant progress towardsdiscovering the impact that our mone-tary policy has on the real economy,’Anwar added.

The guv’nor tells regional central bankers that the box that has been the butt of their neuron exerciseis empty; hence, they need to think out of it. He also told them they had a better chance of solvingthe national economic problems if they actually understood them. The man might have a point…

rupee depreciation putstextile industry in hot waters

ISLAMABADAMER SIAL

A hurriedly called ministerial meeting to finalise plans for the im-port of the Liquefied Natural Gas (LNG) on government to gov-ernment (G2G) basis ended inconclusively due to the refusal of thePlanning Commission (PC) to withdraw its objections and absenceof some of the members on Thursday.

An official source said the convener of the committee and Min-ister for IT Raja Pervez Ashraf pointed out at the outset that sincesome of members of the committee were not present they could notdiscuss the agenda. Two important federal secretaries of finance andlaw were not present in the meeting. The meeting was convened ona short notice by the Petroleum Ministry instead of its convener.

The committee was constituted by the Economic CoordinationCommittee (ECC) on May 15 with Raja Pervez Ashraf as convener tolook into modalities of LNG import. The committee had held threemeetings during which the finance ministry refused to extend sover-eign guarantees for LNG import, while PC recommended hiring anindependent consultant to assess the feasibility of the project andSpecial Advisor to Prime Minister Kamal Majeed Ullah asked forshifting the project from Karachi port to Gwadar Port.

Petroleum Minister Dr. Asim Hussain said the proposal wasimportant one to counter the gas shortages in the country andstressed they could not afford to linger on with the issue. On hisproposal it was decided that the committee will be again meetingon June 16. It was decided that all the members will be directed to

ensure their presence on Saturday. Petroleum Ministry, the sourcesaid is bent upon to get an expeditious approval of the project fromthe committee without any reservations.

However, PC refused to accept the demand of the PetroleumMinister for withdrawing from the record its demand to hire an in-dependent consultant. PC has refused to extend blind support to theproject saying that there are many flaws in the integrated LNG importprogramme including a terminal and gas supplies. It is of the viewthat acceptance of bids of two firms for one project would violatePPRA rules and the relaxation in rules would favour some privatefirms involved in import. After failure of the private sector to expediteLNG imports, the Petroleum Ministry had floated proposal underwhich two companies could be given permission to import LNG ona deal to be signed on G2G basis. It was proposed that the base loadvolume of RLNG will be 800 mmcfd, spread over 2 separate LNGdevelopers, 400 mmcfd each, at delivery point under 10 years con-tractual arrangement. It is seeking approval to allow two selected pri-vate parties to make spot purchases of LNG from Algeria, Qatar,South Korea and Malaysia on G2G basis.

Pakistan is faced with a severe gas shortage exceeding 2 billioncubic feet per day (bcfd) as the local production is unable to keeppace with the requirements of the country. Petroleum Ministry isstressing importing LNG to mitigate the crisis. Imported LNG willbe received, stored and re-gasified and delivered through connect-ing pipelines to the existing transmission pipeline network as Re-gasified LNG (RLNG). The RLNG price will be factored in theWeighted Average Cost of Gas (WACOG).

Get your lazy backsides out of the box!

That awkward moment when Planning Commission spoils all the planningPlanning Commission proves itself to be a bit of a pain in the PetroleumMinistry’s backside by refusing to take back its concerns regarding LNG importsin a ministerial meeting. Dr Asim Hussain kept reminding one and all thatcountering gas shortages is in fact pretty important, but none of the attendeesseemed to care – probably because it was a hurriedly called meeting. And so theministerial committee shall meet again on Saturday to resolve the issue

PRO 15-06-2012_Layout 1 6/15/2012 1:26 AM Page 1

news02Friday, 15 June, 2012

KARACHIZAIN ALI

Karachi Fish Harbour shall remain close for land-ing facilities of all catches of inland and marineseafood. This was decided in a meeting held atKarachi Fisheries Harbour Authority (KFHA).Presiding over the meeting Abdul Ghani Jokhio,Managing Director, KFHA said that during the lastcouple of months we altogether had number ofmeetings on implementation of law on illegal netsand observe ban on catch in July. Finally he addedGovernment had issued two Notifications one forrelaxation in mandatory seasonal ban on fishing inthe month of June thus in July catch shall bestrictly prohibited and only 55 mm mesh size forfish and 25 mm for shrimps shall be allowed. Mr.Jokhio thanked MFD, FCS, STOFA, MSA, Coast

Guards, Moleholders, bonafied fishermen for theirgracious support and courage to work out a policy.Shaukat Hussain, Director General, MFD in-formed the meeting that in fact this achievementis a great service to the fishermen and in the na-tional interest once we succeed in its objective, thecurrent and future generation will reap the bene-fits. According to decisions taken in the meeting,customs authorities would not issue Port Clear-

ance to any fishing boat during ban season. Nostakeholder will sell or buy fish / shrimp duringthe ban season, otherwise catch shall be confis-cated and penalty shall be imposed besides cancel-lation of fishing license, registration of boat andexport registration. Seafood processors shall en-sure that they would not buy any fishery productfrom 1st to 31st July. They shall also declare stockstored in their respective Chill rooms as on 30th

June 2012, by 4th July 2012 to the MFD andKFHA. To implement the operation on seasonalban and banned net, joint inspection teams con-sisting Fisheries Department, KFHA, MSA, CoastGuards, STOFA and representative of fishermenwould monitor the activities and work round theclock. The code-end net will be available for fish-ermen in the next fishing season starting from Au-gust 2012 and only fishing boats carryingapproved net shall be allowed for fishing. The costof code-end net initially will be borne by KFHA,FCS & Pakistan Fisheries Exporters Associationand to be recovered from boat owners upon theirreturn from fishing. The meeting was attended byDirector General, MFD, Deputy Director MSA,MLO Coast Guards, Deputy Director Sindh Fish-eries, Representatives of Pakistan Customs, FCS,STOFA, Moleholders, bonafied fishermen.

ISLAMABADAPP

THE tug of war between a handful of farmers andthe Pakistan Tobacco Board is likely to end in thecoming few days as farmers are realizing that theyare playing in the hands of `vested interests'. This

was stated by Fazal Ilahi, Member Pakistan Tobacco Boardand representative of growers in Khyber Pakhtunkhwa,while talking to media persons here on Thursday. FazalIlahi said that some misguided farmers unknowingly hadbecome a tool of others' ambitions. He said that now therewas realization among the growers that ulti-mately they will be the ones to suffer shouldthe dangerous trend of wrongprojections about tobaccoprice were not stoppedforthwith. He said thatsome cigarette manu-facturers are support-ing farmers on theissue of higher pricesbut that is under-standable as localindustry ishighly un-r e g u l a t e dand tax eva-sion isr a m p a n t .It is perti-nent to mentionhere PTB has fixed aprice of Rs 117 per kgbut that price wasrejected by farmers'representatives. Only a couple of weeksago a joint meeting of Pakistan Tobacco Board, represen-tatives of agriculture department and representatives of to-bacco farmers' association was held at AgricultureInformation Centre in Peshawar in which some Farmers'representatives rejected Rs 117 kg tobacco price that hadbeen fixed by Pakistan Tobacco Board and demanded aminimum rate of Rs 200 /kg. He said that the meeting alsodemanded the federal government to give control of Rs 60

billion excise duty to the provincial agriculture depart-ment. The meeting, through a joint resolution, also re-quested the provincial government to pass a resolution inthe provincial assembly in this regard. Fazal Ilahi said thePakistan Tobacco Board working under the Ministry ofCommerce, has written to Ministry of Food Security andResearch not to interfere in the process of working out thecost of production of tobacco crop in the area of Mardanand Swabi as it was the sole prerogative of Pakistan To-bacco Board. It may be recalled here PTB Ordinance ,1968clearly gives the responsibility of price fixing to PTB thathas already announced indicative minimum prices for to-bacco based on Cost of Production exercise carried out in

November last year. Experts maintainMinistry of Food & Securityclearly lacks clarity on its man-

date and that's why itoften resorts to suchcontroversies. He saidthat experts believe in-crease in tobacco pricewould lead to squeez-

ing local farm-ers out of

g l o b a lcompe-t i t i o ne s p e -

cially aftergiving MFN sta-

tus to India,factoryowners will import

cheaper tobacco fromIndia As Pakistan is movingswiftly to declare India as Most

Favorite Nation (MFN) by the year-end, the Commerce Ministry has issued the

Statutory Regulatory Order (SRO) to implement the cabi-net decision to switch to the Negative List. He said that ar-bitrary increase in tobacco price would also threatengovernment revenue from cigarette excise as proposed leafprice revision will, in fact impact consumer cigarette pric-ing same way and magnitude as recently adopted excise in-crease which is likely to further the cause of cheap illicitofferings in the market.

chew your own tobacco!eu springsinto actiong launches project

for sustainablecotton production

SUKKURAPP

The European Union (EU) has launched anew project funded under its regional ini-tiative Switch Asia for Pakistan for "Sus-tainable Cotton Production for Pakistan'sGinning SMEs" (SPRING), said a press re-lease here on Thursday. The project isbeing implemented by World Wide Fundfor Nature (WWF) Pakistan. The projectwas started in March 2012 in Sukkur andtwo other districts of Pakistan. In this re-gard WWF-P Sukkur arranged a four-weekCotton Selector Training Course with col-laboration of Pakistan Cotton Standard In-stitute (PCSI) for SA-Spring ginners (18ginners) under Capacity building work-shop on Cotton selection and grading forSTEP-I ginners at SWITCH Asia-SPRINGproject office, Sukkur. Some 33 candidatessuccessfully completed the training andout of them 18 candidates were sponsoredby SA-Spring Sukkur to enable them forselection and grading of seed cotton as wellas lint cotton. Local PCGA Representativeand innovative ginner of Sukkur Ludo Mal,was chief guest at the ceremony of certifi-cate distribution among the successful can-didates. He briefed the participants thatPCGA is playing an important role in thecotton sector of Pakistan with its morethan 1000 ginners in the country.

lcci has a turkish chumLAHORE

APP

ASKON and the LCCI have agreed to work inunison to develop trade and economic coop-eration between Turkey and Pakistan. It wasdecided in a meeting between a 37-memberLCCI delegation and ASKON, an Associationof Anatolian Businessmen here on Thursday.The LCCI delegation was led by its PresidentIrfan Qaiser Sheikh while ASKON was repre-sented by Mustafa Koca, the President of theAssociation. The ASKON President offeredLCCI businessmen collaboration in textile,construction, automotive-spare parts, ma-chine-spare parts, consumer durables,electrics-electronics, leather-shoes, finance,jewelery, sanitary and healt products, metal-chemistry, iron-steel, press, packing,tourism, foreign trade, enviromental service,consultancy, and other service sectors. Hesaid Turkey has a variety of advantages inmany areas and is ready to share these po-tentials with Pakistani businessmen there-fore they should come forward and joinhands with their Turkish counterparts toavail these unique opportunities. LCCI Presi-dent Irfan Qaiser Sheikh said in Pakistan,there are a lot of investment opportunitiesfor Turkish businessmen in various sectorslike telecommunications, information tech-nology, financial services, petrochemicals,livestock, dairy, consumer goods, food pro-cessing, pharmaceuticals, minerals, and par-ticularly in energy sectors. He said exchangeof trade delegations between the two coun-tries can prove to be an effective strategy forboosting the level of bilateral trade.

as you sow soshall you reapg record over rs300m sale

of pakistani productsat china trade fair

KARACHISTAFF REPORT

Pakistani exhibitors at the 20th KunmingInternational Trade Fair and 5th SouthAsian Countries Trade Fair made a historyby selling out local products worth over Rs300 million. According to preliminary esti-mates of the Trade Development Authorityof Pakistan (TDAP), about 90 percent ofPakistani exhibitors sold their entire prod-ucts they had taken along to the fair. TheTDAP in a statement issued from Kun-ming, the capital city of Yunnan province ofChina, termed it “a big success”. One of theimportant sale in the fair was an extra largePakistani hand knitted carpet, which wasone of the largest carpets in the world andfamous as “Farsh-e-Azam”. This carpet wassold to the Chinese provincial governmentfor use in the Kunming Exhibition Center.Other than carpets, the quality productsfrom Pakistan like leather products, textileand textile garments, furniture, cutlery,herbal products, handicrafts of wood, mar-ble and brass were appreciated by the visi-tors and all were sold. Another importantfeature of the fair was the introduction andpromotion of Pakistani rice in Yunnanprovince. The 10-member delegation ofRice Exporters Association of Pakistan(REAP) marketed the local rice well duringthe event and also distributed complimen-tary Biryani. Chinese appreciated the tasteand aroma of Pakistani rice.

fpcci invites thedoc for post-budgetdiscussion

KARACHIAPP

The leadership of Federation of PakistanChambers of Commerce and Industries(FPCCI) has invited Federal Finance Min-ister Dr. Abdul Hafeez Shaikh to FPCCIHeadquarters here to discus in detail thepositive and negative aspects of the An-nual Federal Budget 2012-13. During apost-budget press conference here at theFederation House on Thursday, PresidentFPCCI Haji Fazal Kadir Khan Sherani andformer president FPCCI Tariq Sayeedcomplained that the Government hadsidelined the most of their recommenda-tions while making the Annual FederalBudget. "Had our proposals dully accom-modated, the budget would have beenvery supportive for trade and industry,forthe common man," they remarked addingthat non-traditional steps were requiredto be taken through this budget for a posi-tive change in social and economic sec-tors. Both the leaders said that throughthis press conference, they were extend-ing invitation to the Federal Finance Min-ister to have a session with FPCCIleadership and the members for thor-oughly discussing the budget 2012-13.

ISLAMABADONLINE

Islamabad Chamber of Commerce and Industry (ICCI)has urged the Government should setup export process-ing zones in all major cities and give incentives to makethe products competitive in the international market.

Asad Farid, Acting President Islamabad Chamber ofCommerce and Industry in a meeting with Zahid Iqbal,vice Chairman, Export Processing Zones Authority(EPZA) of Pakistan. He underlined the need of estab-lishing Islamabad Export Processing Zone and assuresfull support of ICCI to EPZA that would enable the ex-porters of Federal Capital to increase their exports up todesired level.

Acting President ICCI said that foreign investorsshould be motivated to invest in EPZs so that the ex-ports from Pakistan could be increased as the country atthe moment was in dire need of foreign exchange.

He said that EPZA needs to be more proactive toboost industrialization and augment country's export bycreating facilities for investors to enable them in setup

export oriented units which could create job opportuni-ties, bring in new technology and know-how, and attractforeign investment.

Asad Farid was of the view that Pakistan being theagrarian country needs to establish more agriculturalexport processing zones as establishment of such exportprocessing zones would not only increase the export offarm products, which will be processed in accordance toworld standards, manifold but also help exporters tofetch good price.

Speaking on the occasion, Zahid Iqbal said that theEPZA offers the intending investors an excellent, ami-able, market-friendly and secure atmosphere in its pro-cessing zones. The relevant operative procedures aresimple, hassle-free, easy to understand and time-saving.The cost of doing business is competitive in all EPZs ascompared to other zones in the region, especially formanufacturing.

He said that EPZA is pursuing an extensive programto create a network of export processing zones in Pak-istan. He said that Islamabad EPZ could be establishedwith support and close cooperation of ICCI.

ICCI feels investors

lack motivation

g ptc-farmers tug of war is likely to end soon as the latter realise thatthey were being the marionettes of ‘vested interests’

Here’s a fish taleg fish harbour shall remain closed for landing facilities

of all catches of inland and marine seafood

g icci, epza to collaborate for establishing islamabad export processing zone

PRO 15-06-2012_Layout 1 6/15/2012 1:26 AM Page 2

03

bulls go bananasg bulls erase the recent bear dominance at kse with a 287-point

mad dash, courtesy renewed hope of improvement in pak-us ties

news

Friday, 15 June, 2012

03

red raG: a flaG with fifty stars

lG electronics (lG) announces deal with incrediblemiracle (im) of Global starcraft ii league (Gsl)KARACHI: The IM Team boasts some of the world’s best GSL gamers,including Jong-hyun Jung (Starcraft II ID: IMMvp) and Jae-duk Im(Starcraft II ID: IMNes Tea). Jung held one of the best records of anyGSL gamer last year,picking up big wins atevents such as the Bliz-zCon Invitational, SonyEricsson GSL (January),MLG Anaheim and thePepsi GSL, among oth-ers. GSL matches areregularly watched bymore than two hundredthousand people and onaverage, more than 1.7million viewers per daytune in to watch bigtournaments from nearlyevery country around the world.

omore buzz to promote underground youth talent ISLAMABAD: Omore Buzz – the new ice-cream brand from EngroFoods – has pledged to promote the local talent of Pakistan specif-ically focusing on the youth of the country. The brand has come upwith the concept of a magazine show targeting the talented youth ofPakistan who continue to reflect the Pakistani spirit and bring pos-itive light to the country. The show titled “The No Shashka Show”resonates well with the brand concept of simple enjoyment. In atime when youth is being bombarded with multiple messages fromvarious fronts and tasked with the burden to make important deci-sions, the brand promises to offer a simple yet addictive flavor with-out any superficial feelings or grandeur. The No Shashka Show isbeing hosted by the celebrity RJ and media personality – KhalidMalik who hosts a popular morning radio program and has a strongfollowing in the urban teenage and youth population. Commentingon the program Khalid said: “In my interactions with the youth ofPakistan I have come across numerous individuals who are doingwonders in the fields of education, music, art, IT, livelihoods, etc.The basic concept of the show is to collaborate with a brand thatrepresents the youth market and also offers them a platform toshowcase their raw talent. The country is full of potential and it onlyneeds an opportunity to represent the true face of Pakistan. The NoShashka show focuses on providing that opportunity to the youthand tells the world that we are a country full of diverse flavors and‘chaskas’.” The program will showcase a multitude of talented indi-viduals which include Asfandyar – a beat boxer; Hina Hazrat –Founder of Youth Republic in Pakistan; Bushra Siddqui – youngestblogger of Pakistan; Anhar Ashar – home based confectioner; XehraQadir – wall designer & glass-engraving expert; Shams Javaid –young puppeteer and mascot maker; Ruqaya Fareed – professionalglass painter; and Zohaib Iqbal – from Team Pakistan that fabri-cated a car to reduce fuel consumption to give a mileage of 80 kmsfrom 1-litre of fuel. The show also features original and cover per-formances by up-coming bands and artists.

kasb bank appoints boaJk as moneyGram agentKARACHI: KASB Bank as a Super-Agent of MoneyGram Internationalhas appointed Bank of Azad Jammu & Kashmir as an Agent for Money-Gram International in Pakistan. MoneyGram International is a leadingglobal money transfer company based in the United States. It operatesvia an agent network of around 267,000 locations in 192 countries andterritories worldwide. The agency agreement was signed between KASB

Bank and Bank of Azad Jammu & Kashmir on June 11, 2012. The agree-ment empowers BoAJK to handle and process inward remittances routedvia MoneyGram International from around the globe. The signing of thisagency agreement will allow KASB Bank and BoAJK to better serve thepeople of Azad Jammu and Kashmir, both here in Pakistan and abroad.

spectrum y&r holds 34th annual workshopKARACHI: On June 6, 2012, leading ad agency Spectrum Y&R heldits 34th annual Workshop/Playshop in the Ballroom of the PearlContinental Hotel in Karachi under the banner of "CelebratingChange". The agenda included a recap of the year’s major changes, apresentation on the latest digital media trends and Spectrum’s ownAd of the Year awards, awarding the people behind the agency’s bestwork throughout the past year, judged by an external jury of creativeand media professionals.

cathay pacific releases combined traffic figures for may KARACHI: Cathay Pacific Airways today released combined CathayPacific and Dragonair traffic figures for May 2012 that show a year-on-year growth in passenger numbers alongside a significant dropin cargo and mail tonnage. Cathay Pacific and Dragonair carried atotal of 2,358,171 passengers in May – an increase of 6.8% on thesame month in 2011 – while the passenger load factor rose by 0.2percentage points to 78.5%. Capacity for the month, measured inavailable seat kilometres (ASKs), rose by 4.2%. For the year to date,passenger numbers have risen by 9.1% compared to a capacity in-crease of 7.6%. The two airlines carried 123,403 tonnes of cargo andmail last month, a drop of 10.6% compared to May 2011. The cargoand mail load factor was down by 5.9 percentage points to 62.3%.Capacity, measured in available cargo/mail tonne kilometres, de-creased by 7.3%, while cargo and mail tonne kilometres flowndropped by 15.3%. For year to date, tonnage has declined by 10.7%against a capacity drop of 4.1%. Cathay Pacific General Manager Rev-enue Management James Tong said: “Demand on the passenger sideremained robust throughout May, boosted by the enhancement ofboth Cathay Pacific and Dragonair’s regional services. Dragonairadded four new destinations to its network in May. We continued tosee a decline in yield in the Economy Class cabin on most routes.Business in the premium cabins is now being affected by a fall inyield and a lack of growth in volumes.”Cathay Pacific General Man-ager Cargo Sales & Marketing James Woodrow said: "Demand onceagain remained soft out of the key Hong Kong and Mainland Chinamarkets in May. Demand was down on long-haul routes, particularlyto Europe, though traffic within the Asia Pacific region held up well.We continue to manage capacity in line with demand, at the sametime as developing new markets where possible. In May we launcheda new freighter service to Hyderabad in India following on from thelaunch of services to Zhengzhou in Central China in late March.”

CORPORATE CORNER

Major Gainers

Company Open High Low Close Change Turnover

Rafhan Maize Prod. 3126.71 3283.00 3126.00 3250.09 123.38 801Colgate Palmolive 949.01 974.00 950.00 974.00 24.99 151Wyeth Pak Limited 820.40 844.00 835.00 839.09 18.69 264Philip Morris Pak. 165.80 174.09 173.00 173.57 7.77 5,781Clariant Pak 163.87 171.99 164.99 171.52 7.65 20,395

Major Losers

Nestle Pakistan Ltd. 4052.69 4069.00 4003.00 4016.28 -36.41 34Mehmood Tex 104.26 102.00 99.05 102.00 -2.26 193Exide (PAK) 190.80 191.50 189.00 189.16 -1.64 2,900Shell Pakistan Ltd. 130.03 130.50 128.10 128.39 -1.64 49,002Searle PakistanXD 48.83 48.83 47.61 47.65 -1.18 1,205

Volume Leaders

P.T.C.L.A 13.84 14.75 13.16 14.60 0.76 16,452,107D.G.K.Cement 39.75 41.73 39.99 41.63 1.88 8,252,706Lucky Cement 115.72 118.88 116.25 118.05 2.33 7,053,555Jah.Sidd. Co. 13.77 14.38 13.77 14.01 0.24 6,639,752Engro Corporation 102.13 107.18 102.75 106.62 4.49 5,243,247

Interbank RatesUS Dollar 94.4126UK Pound 146.5661Japanese Yen 1.1892Euro 118.6388

Dollar EastBuy Sell

US Dollar 95.50 96.20Euro 118.32 119.52Great Britain Pound 147.36 148.82Japanese Yen 1.1850 1.1966Canadian Dollar 91.96 93.38Hong Kong Dollar 12.12 12.28UAE Dirham 25.82 26.05Saudi Riyal 25.32 25.51Australian Dollar 93.87 96.26

German bondsgain ahead ofitalian debt sale

LONDONAGENCIES

Safe-haven German bond prices rose and goldfirmed on Wednesday after Spain's credit rat-ing was cut to one notch above "junk" ahead ofa crucial Italian bond sale, and weak U.S. datafuelled concerns that the euro zone crisis washitting global growth. "We are fast approach-ing the point where both Spain andItaly may have to be removed from the mar-ket," said Gary Jenkins, director of SwordfishResearch. Despite the rating cut, the euroticked up slightly against the dollar and Euro-pean shares prices only inched lower as manyinvestors were sidelined ahead of Sunday'scliffhanger election in Greece, which could seethe country exit the currency bloc.Gold traded up 0.15 percent to $1,620 anounce, having already gained over 1 percentthis week, and, after two days of heavy selling,German government 10-year bond prices roseto push the yield down four basis points to 1.46percent. The euro traded around $1.2565, wellwithin its recent range between a near two-yearlow on June 1 of $1.2288 and Monday's three-week high of $1.2672. The FTSE Eurofirst index of top Europeanshares and the blue-chip Euro STOXX 50opened down 0.3 percent, while the MSCIworld equity index dipped 0.2 percent to300.79 points. Italy's borrowing costs are ex-pected to rise sharply at a bond auction of up to4.5 billion euros of new debt later, but thesmall size of the sale should ensure its success.

shares slip on weak usdata, italy debt sale eyed

TOKYOAGENCIES

Asian shares slipped on Thursday as weak U.S. retail sales dataraised concerns about sluggish economic growth, while an Italiandebt auction later will test market confidence in whether Romecan avoid becoming the next victim of the euro zone crisis.Traders expected market activity to slow approaching a cliffhangerSunday election in Greece, which could precipitate the country'sexit from the euro zone. MSCI's broadest index of Asia-Pacificshares outside Japan fell 0.6 percent, with China and Australialeading the decline, while Japan's Nikkei average shed 0.7 percent."I would expect low volume in today's session with risk aversiondominating the mind-set of investors leading up to the Greek elec-tion on Sunday," said Miguel Audencial, trader at CMC Markets inSydney, where stocks fell 0.5 percent. European shares and WallStreet ended lower on Wednesday, while the dollar fell, after datashowed U.S. retail sales hit their worst level in two years in May.Safe haven gold rose. The report could fuel speculation the Fed-eral Reserve may take further stimulus measures at its policymeeting next week to support the U.S. economy, after a weak Mayjobs report added to fears about the euro zone and sparked a broadmarket sell-off earlier this month.EURO STEADY: The euro was steady around $1.2562, caught inthe middle of recent highs and lows - well above the near two-yearlow touched on June 1 at $1.2288, but below a three-week highreached on Monday at $1.2672. The euro's relative stability after asharp downgrade in Spain's credit rating by Moody's InvestorsService on Wednesday was seen as an indication of the extremelybearish stance already taken by investors before the Greek elec-tion. "It tells you much about how bearish market expectationsare when a 3 notch downgrade of Spain pushes EUR/USD 15 pipslower," said Sebastian Galy, strategist at Societe General. "Asiawill not be happy with poor U.S. GDP growth, leading to somenervousness in these (equities) markets. The fear should peakwith the Italian bond auction," he said, noting that the disap-pointing retail sales could lead to lower GDP forecasts. U.S. crudefell 0.1 percent at $82.58 a barrel and Brent crude futures eased0.3 percent at $96.88. Activity was subdued in Asian credit mar-kets, with the spread on the iTraxx Asia ex-Japan investment-grade index, or the cost of insuring against corporate andsovereign defaults in Asia, widening by 1 basis point.

pak-iran trade gate closed for indefinite timeQUETTAONLINE

Zero Point, Trade gate, at Pak-Iran border has been closed forindefinite time. According to media reports, the Iranian au-thorities have closed the Zero Point without any prior intima-tion. Due to this closure the local traders are suffering millionsof rupees losses. On the other hand Public circle said that theZero Point has been closed due to the three day Khatm-e-Al-bukhari conference being held in Iranian city of Zahiddan,which starts on Friday.

KARACHISTAFF REPORT

PAKISTAN stocks closed bullish onforeign interest and institutionalsupport in oversold market onpositive statements by US senator

amid hopes for improvement in Pak-US re-lations as talks continue over resumptionof Nato supply lines. This was viewed byAhsan Mehanti, Director at Arif Habib In-vestments Limited.

The Karachi Stock Exchange-KSEbenchmark 100-share index went up by287.31 points on Thursday and ended thesession at 13,656.20 points. The KMI-30index gained 478.91 points as marketclosed at the level of 23,636.51 points onThursday as against 23,157.60 points, theclosing figure of the previous session. Thetrading session remained positive as indexwitnessed volumes of 114.327 millionshares on Thursday against 77.658 millionshares traded in the previous session.

The trading value increased to Rs4.303 billion compared to Rs 3.464 billionof the previous session. The intraday highand low, respectively, stood at 13, 689.31and 13,368.89 points.

Mehanti added that the World Bankforecast on firm recovery in Pak Economicgrowth, EU trade concessions on Pak ex-ports played a catalyst role in bullish senti-

ments in stocks across the board despiteconcerns for fall in global stocks and com-modities.

The market capitalization grew mod-estly and increased to Rs 3.615 trillionfrom Rs 3.574 trillion a day earlier. Of thetotal 379 traded scrips, 234 gained, 88 lostand 57 finished as unchanged.

The free-float KSE-30 index alsogained 300.97 points to close at 11,800.47points against the previous 11,499.50points. The KSE all-share index closedwith a gained of 196.21 points to 9,618.54points as against 9,422.33 points.

P.T.C.L.A was the day’s volume leadercounting its traded shares at 16.452 mil-lion with the opening and closing ratesstanding at Rs 13.84 and Rs 14.60, fol-lowed by D.G.K Cement, Lucky Cement,Jahangir Siddiqui Company, Engro Corpo-ration and Hub Power Company withturnover of 8.252 million, 7.053 million,6.639 million and 5.243 million shares re-spectively.

On the future market, the turnover re-covered remarkably by over three millionshares to 12.949 million against 9.673 mil-lion shares of pervious day. The RafhanMaize Prod and Colgate Palmolive, up Rs123.38 and Rs 24.99, led highest pricegainers while, Nestle Pakistan Limited andMehmood Tex, down Rs 34.41 and Rs 2.26respectively, led the losers.

bulls go bananasg bulls erase the recent bear dominance at kse with a 287-point

mad dash, courtesy renewed hope of improvement in pak-us ties

PRO 15-06-2012_Layout 1 6/15/2012 1:27 AM Page 3