Intimidating Iran

Ever since Donald Trump has been elected President of United Sates, pressure is mounting on him to re-impose sanctions on Iran. The Arab monarchs have also form a joint force to avert any perceived threat from Iran. Ironically, the Arabs have been brain washed to believe “Iran is a bigger threat as compared to Israel”. I just pulled out one of my articles, written as back as 29^th April 2012 from the archives for the readers. My special thanks to Facebook for keeping this in my memories.

Over the years the United States and Israel have been trying to intimidate Iran and want it to make the first move. They want to put all the blame on Iran to convince the world, as they (Zionists) control media, that Iran was the first to strike and now they have the reasons to attack the country. Both the United States and Israel have been constantly propagating that Iran is a threat for them and for the entire world. Over the years Iran has applied restraint but it is feared that repeated provocations may end Iran’s patience.
The United States really tested Iran’s patience in 2012, before the super power entered into a deal with Iran. It was deployment of F-22, America's most sophisticated stealth jet fighters at a base in the United Arab Emirates that is less than 200 miles from Iran's mainland. However, the US Air Force adamantly denied that presence of jets was a threat to any country. These F-22 fighters were placed in hangars at UAEs' Al Dafra Air Base, just a short hop over the Persian Gulf from Iran's southern border.
Reportedly, spokesperson of US Air Force avoided confirming the exact location of the F-22s, but told these had been deployed at a base in Southwest Asia. He also clarified that the F-22s were simply taking part in a scheduled deployment and were not a threat for Iran. However, he informed that it was a very normal deployment to strengthen military relationships, promote sovereign and regional security, improve combined tactical air operations and enhance interoperability of forces.
The spokesman declined to say what the Raptors' mission was in the region this time around or how many planes had been deployed, citing operational security. However, he said because of the F-22's next-generation capabilities, any number of planes deployed in the region is a significant move.
The F-22 has been officially combat-operational since December 2005 but no plane was used in Iraq, Afghanistan or in the US-led no-fly mission over Libya, may be because the sophisticated jets simply haven't been needed yet. However, when it comes to dealing with Iran, the US and its allied take extra care to avoid any embarrassment.
Lockheed Martin's in-charge for the F-22 program had told that the plane was perfectly suitable for undertaking more sophisticated adversaries and could be used in deep penetration strike missions in well-defended combat zones inside places like North Korea or Iran.
History tells that all the US missions against Iran faced some kind of adversity and F-22 may not be an exception. The new deployment comes in the midst of the Air Forces' continuing battle with a rare but sustained oxygen problem plaguing the F-22. Since 2008, nearly two dozen pilots have reported experiencing "hypoxia-like symptoms" in mid-air. The problem got so bad that the Air Force grounded the planes fo fixing the problem but never could.
Despite the ongoing issues, the US Air Force says the F-22 is ready for war, should it be called. It says "If our nation needs a capability to enter contested air space, to deal with air forces that are trying to deny our forces the ability to maneuver without prejudice on the ground, it will be the F-22 that takes on that mission”.
Often Pakistani’s fail to understand why the Middle Eastern countries are extending support to the United States in a bid to make Iran bow down? Is the inherent dislike of Arabs for Iran is so high that they are ready to join any endeavor to wipe out the country that has withstood sanctions for more than three decades?

Pakistan Stock Exchange posts 29 percent increase in daily traded volume

Having recovered 4.5% in the prior week, benchmark of Pakistan Stock Exchange went back into the red zone during the week ended 28^th April 2017 closing at 49,301. Analysts attribute this fall to new disclosure requirements by SECP, and continued political uncertainty with futures rollover week further aggravating the decline. Average daily traded volumes increased by more than 29%WoW to 359 million shares with volume leaders being EPCL, ASL, ANL, SMBL and TRG. Key news flows during the week included: 1) PSMC unveiling the 1,000cc Celerio (re-branded as the new Cultus) at a ceremony held in Lahore, 2) PPL announcing discovery of 29.2mmscfd gas from its Gambat South block (65% working interest), 3) announcement of Punjab Orange Cab scheme for the unemployed youth by CM Punjab, with expected scheme size of 100,000 units, 4) GoP raising Rs360 billion through auction of short‐term government papers and 5) GoP notifying a relaxation of the moratorium on new gas connections for industrial, commercial and captive power plants directing the gas utilities to implement it with immediate effect. Gainers of the week were AGTL, PSMC, INDU, ASTL and HCAR; while laggards included PPL, EFERT, NCL, NML and CHCC. Foreign participation continued its negative trend with US$10.71 million outflows compared to US$31.97 million in the prior week. With the result season nearing its end, analysts expect the market to remain range-bound amid lack of triggers.

Contrary to February, country's total exports during March'17 rebounded 9.9% MoM/3.4%YoY to US$1.8 billion, where textile exports (60% of total exports) posted marked recovery to clock in at US$1.064 billion up 7%MoM. The upswing in the textile exports in March'17 was primarily driven by 9.9%YoY growth in value added exports to US$775 million, while non‐value added exports declined to US$289 million down 2.5%YoY. On a cumulative basis, 9MFY17 textile exports were still 0.77%YoY lower at US$9.29 billion, largely contributed by 8.5%YoY decline in the low value segment diluting the impact of 2.5%YoY growth in the value added segment. Looking ahead, textile exports are likely to remain under pressure due to: 1) demand side bottlenecks emanating from depressed Chinese demand and slowdown in EU, post Brexit, 2) liquidity crunch faced by textile sector due to delay in tax and rebate refunds amounting to Rs300 billion and 3) continuous upward trend in international and local cotton prices, raising cost of doing business. Having said that, recent appreciation in regional currencies as compared to slight depreciation in the PkR/US$ coupled with Rs180 billion export package, may extend some support to the declining exports, going forward.

Fauji Fertilizer Company (FFC) posted unconsolidated profit after tax of Rs2.19 billion (EPS: Rs1.72) for1QCY17 as compared to net profit of Rs2.73 billion (EPS: Rs2.14) for 1QCY16, down 20%YoY. Earnings came in slightly above market expectation due to 5.4% higher than expected topline on the back of greater than anticipated offtake growth. Key highlights of 1QCY17 earnings includes:  1) a 4%YoY decrease in topline to Rs11.19 billion reflecting 4%YoY expected slowdown in Urea offtake coupled with low urea prices and 2) improvement in gross margin to 31.5% (including subsidy) during 1QCY17 due to low feed gas prices (down 39%YoY) restricting earning decline. Along with results, the company also announced an interim cash dividend of Rs1.50/share.

Indus Motor Company (INDU) reported robust earnings for the 3QFY17 amounting to Rs4.17 billion (EPS: Rs53.05) higher by 41%YoY, beating out estimates and recording its highest earning quarter ever. Stellar earnings were the outcome of: 1) topline growth of 16%YoY, where the deviation may have occurred from higher CBU sales, 2) improved margins of 19.2%, signifying improved margins for the facelift Revo and Fortuner variants and 3) effective tax rate of 30% 1QFY17. On the flip side, finance costs rose 899%YoY due to the late payment on deliveries and below the line expenses increase tapering the bottom-line. Net profit for 9MFY17 rose to Rs10.24 billion (EPS: Rs130.34) up 16%YoY, with total payouts over the period at Rs80/share. Thus the company has a higher payout ratio that added to the planned CAPEX of Rs3.5 billion for FY17, points to improved liquidity at the OEM.

Dropping “Mother of All Bomb” in Afghanistan a “Hoax Call”

This picture has been released by Reuters, my special thanks to the news agency for providing support to the narrative of a third world citizen  

If one peeps into the history of the US imposed wars, one point is clear that the establishment has been providing exaggerated and grossly incorrect reports to media. Ironically the ‘embedded journalists’, often working for mainstream media, have proved nothing but buffoons.

One of the recent examples is dropping of “Mother of All Bombs" in Afghanistan on 13^th April 2017. All the details were made public about its code name, model number, weight, cost impact etc but hardly any details have been made public about the number of people killed and their identity, to the extent that no dead bodies were shown to media. It is also a fact that media has not been allowed to visit the site.

Reportedly, Defense Secretary James Mattis said that he did not intend to discuss damage estimates from the use of most powerful non-nuclear bomb. One has all the reasons to suspect that the Secretary is deliberating avoiding pinching questions being raised on social media. It is also suspected that even Pentagon does not have the evidence to share with the media.

The common grudge is that the US is unwilling to share information about the people killed except to say these were nameless, faceless, cave-dwellers. One may also ask questions like who were these people and for how long there were living there. The nationalities of those killed also remain undeclared.  Falling of the biggest bomb has been followed by the loud silence. The future of Afghanistan remains as uncertain as ever.

Reportedly, an Afghan official said that the bombing killed 96 militants but provided no proof of the deaths or information on how officials reached the number of casualties. One wonders if Afghan or the US troops have made it to the bombing site. It has been reported that security forces are blocking both journalists and local residents from accessing the site.

The blast triggered shock-waves which residents said they felt miles away. In all sincerity, Afghans in particular and the world in general with some conscience have a right to demand an end to indiscriminate killing of Afghans. The terrorism waged by the US and its allies in the name of the 'war on terror' far outstrips the violence of those termed terrorists.

When will OPEC come out of illusion created by the western media?

Since the Saudi-led OPEC agreed to curtail production, I have been saying that it is an attempt to gulp their market share. Western media, mostly own by anti-Muslim groups, is still trying to persuade OPEC to further cut output to facilitate the US to attain the status of largest oil producing country.

Till recently, there was embargo on export of oil from the US as the country was oil deficient. Now the US has attained the club of oil exporting countries and its exports are on the rise. Shipment data also shows more oil being moved through the oceans than when cuts were put in place.

According to Reuters, oil prices tumbled more than 2 percent on this Friday, posting the biggest weekly decline in more than a month. The fall was prompted by rising US production and stockpiles. This completely frustrates attempts by OPEC to reduce the global crude glut.

During the week ended on Friday, Brent fell 7 percent, while WTI came down 6.7 percent. It was the largest percentage drop for both benchmarks since the week of March 10, when rising concern about the supply glut undermined big bets on an oil rally.

Many analysts suggest that OPEC should continue reduction in production for another six months. On Friday an OPEC and non-OPEC member technical committee recommended extending cuts of almost 1.8 million barrels per day (bpd) to be formally approved at the upcoming 25th May meeting.

While it is not clear that Russia would support an extension, it is also feared that OPEC-led by Saudi Arabia may leave the cartel vulnerable. The logic is simple, why should it support the US oil producers?

Reportedly, US drillers added oil rigs for a 14th week in a row, extending an 11-month recovery that is expected to boost US shale production in May in the biggest monthly increase in more than two years. Drillers added five oil rigs in the week to ending 21st April, taking the total count up to 688, the most since April 2015. That is more than double the same week a year ago when there were only 343 active oil rigs.

Analysts projected that US energy firms would boost spending on drilling and pump more oil and natural gas from shale fields in coming years with energy prices expected to climb. After taking a hit last year when dozens of US shale producers filed for bankruptcy, private equity funds raised $19.8 billion for energy ventures in the first quarter - nearly three times the total as compared to the same period last year.

A US financial services firm said in a note this week that its capital expenditure tracking showed 57 exploration and production (E&P) companies planned to increase spending by an average of 50 percent in 2017 over 2016. The expected spending increase in 2017 followed an estimated 48 percent decline in 2016 and a 34 percent decline in 2015.

I am forced to arrive at a conclusion that those at the helm of affairs of OPEC are not sincere with their own countries but facilitating the US to attain the status of largest oil producing and exporting country, please correct me if I am wrong.

Pakistan Stock Exchange Witnesses Quantum Jump in Average Daily Trading Volume

During the week ended 20^th April, 2017, Panama case verdict cleared political uncertainty along with upcoming MSCI inclusion, positive sentiments are likely to prevail going forward. Ongoing results season is likely to accelerate momentum, while budgetary proposals can direct market performance accordingly. The key news flow during the week included: 1) Net foreign direct investment (FDI) soared 12.4%YoY to US$1.6 billion during first nine months of current financial year, 2) FY18 federal budget would be presented on May 16’17 as announced by Finance Minister, 3) Current account deficit increased by 161%YoY to US$6.13 billion during nine months of current financial year, 4) ASTL announced expansion in steel melting/rolling mill capacity by 200,000/270,000 tons per annum and 5) GoP rejected all bids in the latest PIB auction held on 19^th April. Average daily trading volume increased by 62.44%WoW to 277.66 million shares where volume leaders of the week were: EPCL, TRG, KEL, ASL (63.4mn shares), and 5) BOP (48.5mn shares).Top performers during the week were: SNGP, ASTL, CHCC, HASCOL, and HCAR, while from the main board only MCB ended up in the red zone.

The current account deficit (CAD) reduced to US$562 million in March’17 from US$822 million in February’17 (down 32%MoM). Despite slight increase in trade deficit (+0.85%MoM), the monthly improvement came on the back of higher remittances in March’17 amounting to US$1.69 billion, recording sequential rise of 20%MoM. However, current account dynamics remain considerably weaker on YoY basis, with US$122 million surplus recorded in March'16, due to continued escalation in imports (+34%YoY to US$4.3 billion) particularly on higher auto/machinery imports and higher crude oil prices. The cumulative CAD for 9MFY17 surged to US$6.1 billion, posting an increase of 161%YoY bringing the deficit close to 1.9% of the GDP. This reflects weak trade dynamics. Going ahead, current account is expected to continue its downward slide on account of falling exports, rising imports and remittances remaining flat.

FFBL is scheduled to announce earnings for 1QCY17 on Monday, 24^th April where AKD Securities expects the company to post net loss of Rs97 million (LPS: Rs0.10) as compared to a net loss of Rs514 million (LPS: Rs0.55) for 1QCY16. This reduction in loss is expected on the back of: 1) a 19% YoY increase in topline to Rs5.24 billion reflecting 54%YoY likely increase in DAP off‐take to 109,000 tons and 2) improvement in gross margin (GM) to 12.7% for 1QCY17 due to significant decline in phosphoric acid prices diluting the effect of significant reduction in DAP prices due to depressed international prices.

EFERT is also scheduled to announce its quarterly financial results on the same day. The brokerage house expects EFERT's earnings to nosedive to Rs1.19 billion (EPS: Rs0.90), down 44%YoY. The decline in earnings is expected on the back of: 1) GM declining to 33.2% on account of reduction in urea prices (down 9%YoY) due to depressed farm economics and low international prices, down  by 10%YoY to an average of US$210/ton in 1QCY17.