If Iran attacks US interest in Middle East?

Israeli airstrike on an Iranian Embassy compound in Syrian capital has spurred fears of a renewed aim at the US interests in the region, despite the US officials claiming no advanced knowledge of the attack. 

Former U.S. officials and experts say the strike, which Iran’s Islamic Revolutionary Guard Corps said killed two senior members and five officers Monday in Damascus, could mean renewed attacks on the US troops and bases in Iraq and Syria by Tehran-backed proxies.

Though the US has denied any involvement in the Damascus strike — which happened during the day on a diplomatic building near Iran’s Embassy — being Israel’s biggest ally has put Washington in the crosshairs of any retaliation from Iran.

Experts agree that any Iranian response has to be carefully calibrated to avoid a costly all-out war involving the US or its key regional ally.

By not responding, Iran will look weak, both its own forces and to its allies. It seems Iran is also very cautious about getting into any encounter with the United States or with Israel. 

The Pentagon indicated that officials were concerned Israel’s strike against Iran may increase the risk to US troops in the region.

Israel has not taken responsibility for the airstrike, the US assessed that Israel was responsible.

Israel also appeared to be preparing for blowback from the strike Thursday, when its military announced it was suspending leave for reservists.  

Pakistan Stock Exchange benchmark index touches new highs

Market's bullish momentum continued during the week ended on April 05, 2024, with the benchmark index challenging previous highs and achieving the highest-ever closing at 68,417 points on Thursday, with a gain of 1,412 points or 2.1%WoW.

The momentum was supported by easing inflation, turning real interest rates positive for the first time in 38 months.

Foreign investors and institutions injected additional liquidity through buying, supporting the market's momentum.

Despite a 9.2%MoM growth in exports, trade deficit widened to US$2.2 billion, up 25%MoM.

With Eid approaching, remittances are expected to increase, helping to control the current account balance.

FBR missed its monthly tax collection target for the third consecutive month, although the 9MFY24 numbers were still within target.

World Bank estimated the country's GDP growth target at 1.8% for the current year, below 3% for the following two years, resulting in an overall combined GDP growth for three years that remains lower than the population growth rate.

With a stable exchange rate and high yields, hot money has begun to return, with net inflows into T-bills from January to March 22, 2024, reaching US$126 million.

Reportedly Saudi Arabia has expressed interest in purchasing shares of two E&P giants ‑ OGDC and PPL, in addition to an expected investment of US$1.0 billion in the Reko Diq project.

According to the reports, Lahore High Court dismissed the application against the deregulation of non-essential medicines, which boosted positivity in the sector on the last trading day of the week.

Lastly, increasing tensions in the Middle East have led to international oil prices reaching their highest levels in six months, posing risks to Pakistan’s import bill as well as the inflation outlook if not eased promptly.

Despite bullish sentiments, market participation declined with daily traded volume averaging at 307 million shares as compared to 331 million shares a week ago, down 7.1%WoW.

Other major news flows during the week included: 1) experts estimated Pakistan needs US$120 billion needs in external financing over five years, 2) Petrol price increased by PKR9.66 per litre, and 3) Cement dispatches were up 3.85%MoM in March.

Pharmaceuticals and Refineries were amongst the top performers, while Transport, Tobacco, and Synthetic & Rayon were amongst the worst performers.

Major net selling was recorded by Insurance cos. with a net sell of US$5.6 million. Foreigners absorbed most of the selling with a net buy of US$3.9 million.

Top performing scrips of the week were: DAWH, SCBPL, MUREB, BIPL and SEARL, while top laggards included: PTC, KTML, PAKT, IBFL and PKGS.

Going forward, market is expected to return its focus to negotiations with the IMF regarding the EFF program, upcoming monetary policy committee meeting, and the corporate results season following the Eid holidays.

Despite the market reaching its highest levels, the forward P/E remains below 4.0x, which instills positivity regarding the market's fundamentals. Analysts continue to advise investors to consider fundamentally strong stocks.

 

 

 

 

Israel cancels troops leave over Iran threat

Israeli authorities seem to believe an Iranian response is imminent and could come as soon as Friday, which is Quds Day — or Jerusalem Day — the last Friday in the Muslim Holy month of Ramadan. It is a day which has frequently been used to stage pro-Palestinian and anti-Israel rallies, particularly in Iran.

On Thursday, GPS systems were being disrupted in central parts of Israel, a defensive measure designed to interfere with weapons which rely on it to set their location.

GPS is already disrupted in northern Israel, near the border with Lebanon, where Israel and the Iranian-backed group Hezbollah have exchanged fire almost daily for the last six months.

Israeli citizens reported being unable to use location-based app services in major cities like Tel Aviv and Jerusalem far from active combat zones.

Monitoring website GPSJAM showed widespread interference with location signals across Israel.

A BBC producer said her GPS had located her in Cairo when she was in Jerusalem, and other users have shared similar accounts on social media.

IDF spokesman Rear Adm Daniel Hagari confirmed the country is using GPS blocking — which is sometimes referred to as "spoofing".

Israelis have been urged to manually set their location on the app which issues alerts about incoming rocket attacks to ensure it remains accurate amid the GPS interference, the Times of Israel reported.

Iran has vowed to respond after a strike on its consulate building in Syria on Monday — which Israel was widely believed to be behind — killing 13 people, including a senior general.

The Israel Defense Forces (IDF) announced it is halting all leave for soldiers serving with combat units.

It comes a day after reservists were called up to bolster air defence units.

Separately, the IDF has urged people not to panic-buy. Writing on X, formerly Twitter, Rear Adm Hagari said, "There is no need to buy generators, store food and withdraw money from ATMs.

"As we have done until today, we will immediately update any change if it is in an official and orderly manner."

Israel has not commented on the targeting of a building on Iran's diplomatic compound in Damascus, the capital of Syria, but has been blamed by the country's leader Ayatollah Ali Khamenei.

Iran's President Ebrahim Raisi previously said the strike would "not go unanswered", though it is unclear what actions Iran could take in response.

Among the 13 people killed in the strike were seven officers in Iran's Revolutionary Guards, including senior general Mohammad Reza Zahedi and his deputy.

Zahedi is one of the most high-profile Iranian figures believed to have been killed by Israel in the country's long campaign of targeted assassinations.

Israel has previously acknowledged carrying out strikes in Syria on targets it says are linked to Iran or its allied armed groups.

Israel targeted aid workers systematically

Celebrity chef Jose Andres told Reuters in an emotional interview on Wednesday that an Israeli attack that killed seven of his food aid workers in Gaza had targeted them systematically, car by car.

Speaking via video, Andres said the World Central Kitchen (WCK) charity group he founded had clear communication with the Israeli military, which he said knew his aid workers' movements.

"This was not just a bad luck situation where ‘oops’ we dropped the bomb in the wrong place," Andres said.

"This was over a 1.5, 1.8 kilometers, with a very defined humanitarian convoy that had signs in the top, in the roof, a very colorful logo that we are obviously very proud of," he said. It's “very clear who we are and what we do.”

Andres said the IDF was aware of the convoy's whereabouts, opens new tab. He called for investigations of the incident by the US government and by the home country of every aid worker that was killed

"They were targeting us in a deconflicting zone, in an area controlled by IDF. They knowing that it was our teams moving on that road ... with three cars," he said.

The aid workers were killed when their convoy was hit shortly after they oversaw the unloading of 100 tons of food brought to Gaza by sea. Israel's military expressed "severe sorrow" over the incident and Prime Minister Benjamin Netanyahu called it unintentional.

Andres said there may have been more than three strikes against the aid convoy. He rejected Israeli and US assertions that the strike was not deliberate.

"Initially, I would say categorically no," Andres said when asked if he accepted that explanation.

"Even if we were not in coordination with the (Israel Defense Forces), no democratic country and no military can be targeting civilians and humanitarians," he added.

Asked for comment on Andres' remarks, an Israeli military spokesperson referred to prior comments by chief of staff Herzi Halevi in which he called the incident a grave mistake and said the attack was not carried out with the intention of harming WCK aid workers.

Andres said he was personally supposed to be there with his team but was not able to go back to Gaza at the time.

The US needs to do more to stop the war, he said. Andres spoke to President Joe Biden on Tuesday.

"The US must do more to tell Prime Minister Netanyahu this war needs to end now," he said. He questioned Biden administration moves to supply aid in Gaza while also arming Israel.

"It's very complicated to understand ... America is going to be sending its Navy and its military to do humanitarian work, but at the same time weapons provided by America ... are killing civilians," he said.

The chef also wondered aloud how Netanyahu could wage a war to save Israeli hostages when they may be dying under the rubble of the same weapons Israel used against Palestinians.

 

Biden’s scaled down Iftar dinner

The White House held a scaled-down Iftar dinner to celebrate Ramadan, after some invitees turned the president down over frustrations in the Muslim community over his policy toward Israel’s military campaign in Gaza.

US President Joe Biden met with Muslim leaders before having a small dinner with senior Muslim officials in his administration, first lady Jill Biden, Vice President Kamala Harris and her husband.

“President Biden will host a meeting with Muslim community leaders to discuss issues of importance to the community,” the White House press secretary Karine Jean-Pierre told reporters, explaining these leaders would rather have a meeting than a dinner.

The White House “adjusted the format to be responsive,” she said.

One of the attendees, Dr Thaer Ahmad, an emergency room doctor who spent at least three weeks in Gaza, told CNN that he walked out of Tuesday’s meeting before it ended.

“Out of respect for my community, out of respect for all of the people who have suffered and who have been killed in the process, I needed to walk out of the meeting,” Ahmad said.

Ahmad, who said he was the only Palestinian-American in the meeting, said “there wasn’t a lot of response” from Biden.

“He actually said he understood, and I walked away,” Ahmad told CNN.

The event is a sharp contrast to last May when Biden hosted a reception for Eid. Dozens of attendees cheered Biden at the White House as he told the crowd: “It’s your house.”

Muslim members of Congress who attended that event included Representatives Ilhan Omar and Rashida Tlaib, who is Palestinian American.

They are now among the biggest critics of Biden’s Gaza policy.

Emgage Action, a Muslim American advocacy group, said it declined an invitation to Tuesday’s dinner, citing Biden’s “continued unconditional military aid to Israel,” which they say has led to a “humanitarian catastrophe of epic proportions.”

Many Muslims, Arabs and anti-war activists have been angry with the administration’s support for Israel and its military offensive in Gaza that has killed tens of thousands and caused a starvation crisis in the narrow coastal enclave of about 2.3 million people.

Israel is the leading recipient of US foreign aid, and the US vetoed multiple votes at the United Nations calling for a ceasefire in the Gaza assault that began after the Hamas attacked Israel on October 7.

Muslim and anti-war groups held a protest Iftar in Lafayette Park near the White House. They distributed dates and water bottles to break the fast at sunset.

 

Iran blames United States and Israel for attack on its embassy in Syria

Iran is engaged in the first part of its response to an airstrike on Monday in Damascus, which it blames on Israel. It also blames the United States.

This shows how Iran is seeking to link the incident that killed several key Islamic Revolutionary Guard Corps members to a wider regional struggle in which Iran is engaged in trying to reduce US influence in the region.

Iranian Foreign Minister Hossein Amir Abdollahian has highlighted the attack on the consulate compound in Damascus and also sought to spotlight what Iran claims is the “American administration’s responsibility.”

Iran buried members of the IRGC killed in Damascus, which included Quds Force commander for operations in Syria and Lebanon Brigadier General Mohammad Reza Zahedi, his deputy, and five of their accompanying officers, according to Iran’s pro-government Fars News.

Meanwhile, Iranian President Ebrahim Raisi phoned Syrian leader Bashar al-Assad and lashed out at the West for continuing to provide financial and military support to Israel amid the Gaza war, and stressed the Zionist regime does not adhere to any of the humanitarian and international principles.

“There is no doubt that Zionists and their supporters are responsible,” Raisi said.

“The Syrian president stressed that the Zionist regime seeks to escape from the quagmire it is caught in by the Palestinian resistance in the besieged enclave and emphasized the need to support the axis of resistance,” the report noted.

At the same time, in a statement to the UN, the Iranian envoy said, “Yesterday, we urgently notified the Security Council members of yet another flagrant violation of international law committed by the Israeli regime within Syria territory.

As reflected in our letter, on April 01, 2024 our diplomatic premises in Damascus came under terrorist attacks carried out by the Israeli regime.

Seven missile airstrikes from the occupied Golan Heights, specifically and intentionally targeted the diplomatic premises of Iran including the consular section building and the ambassador’s residence.”

The Iranian envoy said, “The final and accurate death toll remains uncertain as the entire diplomatic premises has been destroyed, with individuals trapped under the rubble.”

Iran wants the United Nations Security Council to do more in the wake of the airstrike. Iran has also sought to get Russia’s support and to mobilize condemnation in the Gulf countries which have reconciled or normalized with the Syrian regime in the last two years.

This means that they have a vested interest in condemning an attack on a diplomatic post in Damascus. The fact is the building next to the Iranian consulate was not a purely diplomatic site, as it was used by the IRGC.

However, from the standpoint of the Gulf states, it is worthwhile to appear to condemn the strike. Iran and Saudi Arabia also reconciled last year, meaning Riyadh has an interest in appearing to condemn the attack.

Iran is trying to mobilize this diplomatic support before lashing out with its promised retaliation.

 In the past, Iran has attacked Erbil in Iraq when it wanted to retaliate. In 2020 it fired ballistic missiles at a base in Iraq in retaliation for the US killing of IRGC Quds Force head Qasem Soleimani.

Iran has already mobilized its militias and proxies in various countries since October 07 to attack Israel and US forces in Iraq and Syria. In addition, the Iranian-backed Kataib Hezbollah targeted US forces in Jordan in January.

As such, the Iranian claim that is retaliating is a bit of a stretch, because it is Iran that has been attacking throughout the region. However, Iran wants the sympathy of other countries and it wants an official record of this attack in Damascus, so it can claim a right to respond. Iran also wants to leverage this with Russia, China and other states. 

 

Beijing nudged Syngenta to withdraw IPO

Chinese authorities nudged Swiss agrichemicals and seeds group Syngenta to withdraw its application for a long-delayed US$9 billion IPO in Shanghai on concerns about the impact a sizeable new offering would have on a volatile market, reports Reuters.

The Chinese state-owned pesticide giant last Friday withdrew its bid for the initial public offering (IPO) saying the decision was taken "after careful consideration of the industry environment and the company's own development strategy".

Syngenta filed to list on the main board of the Shanghai Stock Exchange May 2023 seeking to raise 65 billion yuan (US$8.98 billion) and passed a review by the bourse's listing committee a month later. Its executives said as recently as November 2023 that Syngenta planned to list in 2024.

The company did not secure a green light from China's securities regulator or top leaders at the State Council, a prerequisite for blockbuster IPOs to go ahead, said the four people familiar with the matter.

The planned flotation finally came unstuck after Syngenta, owned by Sinochem, in March received informal instructions from the China Securities Regulatory Commission (CSRC) to pull its bid for the mega listing.

The reason for Syngenta's IPO withdrawal and the way it was managed, have not been reported previously, underscore how Beijing is prioritizing boosting investor confidence in the secondary market over the launch of new equity offerings.

The government's request for Syngenta to scrap its IPO came despite the company's seeds being essential to food security and China's self-reliance in grain production, which the country's leaders, especially President Xi Jinping, have strongly promoted.

The withdrawal resulted from Chinese authorities' concerns over the potential impact of a sizeable IPO on the frail stock market which had a wretched start to the year, said the four people with knowledge of the matter.

Large IPOs have often been cited by analysts as a reason for triggering the plunge of domestic stock markets, as large amounts of money are frozen when subscriptions are taken, sapping liquidity in the secondary market.

China's stock market rout at the beginning of the year came after mainland shares lagged global stocks for three years and with deflation at levels not seen since the global financial crisis of 2008-09.