Latest news with #Equities&Research
Business Recorder
02-08-2025
- Business
- Business Recorder
HBL PMI holds steady near 10-month low, business confidence rises
KARACHI: The HBL Pakistan Manufacturing Index (PMI) remained unchanged at 50.5, mirroring the modest expansion seen in June's 10-month low. The PMI is compiled by the renowned financial analytics firm S&P Global and is widely used among analysts as a leading indicator to assess the state of the economy. Factory output rose at a slightly improved rate in July, primarily due to the completion of existing orders while new orders continued to slide for the third straight month. Survey participants attributed the subdued order flow to rising costs of raw materials, energy, and taxation. New orders were also weighed down by a decrease in fresh export orders, marking the third decline in the last four months. This aligns with SBP data indicating a 9 percent QoQ decline in exports in the second quarter of the year. Manufacturers cited muted global demand and elevated tax burdens as key factors. Work backlogs depleted at a faster rate and were down for the seventh consecutive month amid lacklustre demand and order completion. As a result, employment contracted for the second month running, with firms scaling down staffing due to lighter workloads and cost management strategies. Kumail Chevelwalla, Team Lead, Equities & Research – HBL, commented on the latest release saying 'Despite these headwinds, business confidence strengthened, reaching a three-month high, driven by optimism around improving macroeconomic and geopolitical conditions, coupled with expansion initiatives and product rollouts. While the monetary easing cycle began more than four quarters ago, the anticipated impact of policy rate cuts has yet to be manifested in the industrial sector, with LSM contracting 1.2% in the eleven months of fiscal year 2025. However, we expect strong business confidence, further rate reductions and better consumer spending power to bode well for the real economy in the medium-term.' Copyright Business Recorder, 2025
Business Recorder
05-06-2025
- Business
- Business Recorder
Pakistan's manufacturing PMI falls amid geopolitical unrest & supply disruptions
KARACHI: The headline HBL Pakistan Manufacturing PMI fell to an 8-month low of 51.1 in May from 51.9 in April, reflecting a notable slowdown in business activity from the series peak in December. Analysts attribute the decline to disruptions caused by the recent geopolitical unrest and raw material shortages linked to road closures. The HBL S&P Manufacturing PMI, serves as a key economic indicator, offering a clearer & timely signal of business conditions compared to traditional GDP data. Unlike GDP, which is published quarterly and often revised, the PMI delivers real-time economic signals, showing a stronger correlation with equity markets. The exclusion of public sector activities partially helps explain why the PMI survey's global output index exhibits a higher correlation with equities. Humaira Qamar, Head of Equities & Research - HBL, commented on the latest report, stating 'The moderation in business activity was driven by a contraction in new orders—the most forward-looking subindex—emanating from geopolitical unrest and logistical disruptions. Export orders declined for a second consecutive month, further dampening business sentiment. While output expanded, it was mainly driven by the completion of existing orders. Despite temporary headwinds, including tariffs & geopolitical unrest, the outlook for the manufacturing sector remains optimistic. The survey indicates strong business confidence in production growth over the next year, fueled by expectations of improving demand.' Humaira mentioned that although interest rates are at their lowest in 3 years, the government's contractionary fiscal stance continues to keep growth prospects in check. Provisional estimates showed GDP growing at a modest 2.7% in FY25, up only slightly from 2.5% last year. This year's Federal budget is set for release on June 10 in close coordination with the IMF, where the authorities are expected to continue strong consolidation efforts, targeting a primary budget surplus of 1.6% of GDP, the third consecutive surplus. According to Humaira, FBR tax revenues are expected to rise 16%, outpacing nominal GDP growth, pointing to the limited scope for tax relief in the upcoming budget. She further stated 'To uphold fiscal discipline & offset potential tax shortfalls, the government will likely bolster non-tax revenues—through higher levies on petroleum products—and tighten development expenditures. However, defense spending may remain insulated from cuts, given the prevailing geopolitical landscape.' Copyright Business Recorder, 2025
Arab News
03-05-2025
- Business
- Arab News
Pakistan's factory PMI dips in early sign of global tariff headwinds
KARACHI: Pakistan's manufacturing sector growth slowed to a seven-month low in April, with the HBL Pakistan Manufacturing Purchasing Managers' Index (PMI)easing to 51.9 from 52.7 in March, as concerns over global trade weighed, HBL said in a press release. The latest dip in the index hints at the impact of US President Donald Trump's trade tariffs, said Humaira Qamar, Head of Equities & Research at HBL. 'We believe that the latest PMI dips are early signs of the headwinds to the global economy from the introduction of US tariffs,' said Humaira Qamar — Head Equities & Research at HBL. New orders slumped while export orders in particular plummeted. Employment fell for a second month as firms cut costs, said Qamar. Qamar warned that any US stagflation would hurt Pakistan's exports, particularly to the US which accounts for 18 percent of its total, potentially prolonging the manufacturing downturn, though lower commodity prices could provide some relief, she added. Despite the slowdown, the PMI remains above 50, indicating expansion amid a favorable inflation outlook. Qamar said she expects an interest rate cut on Monday due to strong deflationary pressures. But a Reuters poll suggests Pakistan's State Bank will hold rates steady at 12 percent, following a surprise pause in its last meeting due to geopolitical tensions and inflation concerns. Pakistan's annual inflation rate fell to 0.3 percent in April, well below the Ministry of Finance estimate of 1.5 percent to 2 percent. The central bank forecasts average inflation to be in the range of 5.5 percent to 7.5 percent for the fiscal year ending June. Pakistan's largest bank, HBL, and global financial information and analytics firm S&P Global launched the index In February to track the country's manufacturing sector.
Business Recorder
02-05-2025
- Business
- Business Recorder
Pakistan's factory PMI dips in early sign of global tariff headwinds
KARACHI: Pakistan's manufacturing sector growth slowed to a seven-month low in April, with the HBL Pakistan Manufacturing Purchasing Managers' Index (PMI)easing to 51.9 from 52.7 in March, as concerns over global trade weighed, HBL said in a press release. The latest dip in the index hints at the impact of U.S. President Donald Trump's trade tariffs, said Humaira Qamar, Head of Equities & Research at HBL. 'We believe that the latest PMI dips are early signs of the headwinds to the global economy from the introduction of U.S. tariffs,' said Humaira Qamar - Head Equities & Research at HBL. New orders slumped while export orders in particular plummeted. Employment fell for a second month as firms cut costs, said Qamar. Qamar warned that any U.S. stagflation would hurt Pakistan's exports, particularly to the U.S. which accounts for 18% of its total, potentially prolonging the manufacturing downturn, though lower commodity prices could provide some relief, she added. Despite the slowdown, the PMI remains above 50, indicating expansion amid a favourable inflation outlook. Qamar said she expects an interest rate cut on Monday due to strong deflationary pressures. But a Reuters poll suggests Pakistan's State Bank will hold rates steady at 12%, following a surprise pause in its last meeting due to geopolitical tensions and inflation concerns. Pakistan's annual inflation rate fell to 0.3% in April, well below the Ministry of Finance estimate of 1.5% to 2%. The central bank forecasts average inflation to be in the range of 5.5% to 7.5% for the fiscal year ending June. Pakistan's largest bank, HBL, and global financial information and analytics firm S&P Global launched the index In February to track the country's manufacturing sector.
