Banking growth may be dampened

KARACHI (Agencies): Growth rates, credit risk and earnings of the banking system are likely to remain under strain in future due to constrained economic environment both at home and global fronts. According to the State Bank of Pakistan's Quarterly Performance Review of the Banking System for the quarter ended December 31, 2008 released on Saturday. Pakistan's banking system effectively coped with several challenges emanated from economic slowdown, both at home and abroad, due to strong resilience built over the years and effective regulatory and supervisory regime.

The present tough economic environment will also heighten the credit risk and affect the earnings due to increased loan loss charges and constrained incomes. The system is expected to remain profitable in the coming quarters, though this phenomenon may not be widely shared across the market players. Though the concerns about the solvency of top banks of the world are weighing on the investor confidence across the globe, the banks in Pakistan are still maintaining their resilience, the report said. The strength of the banking system largely comes from the prudent regulatory and supervisory regime strengthened risk management and governance standards in banks as well as the improved solvency and earning capacity of banks, it added. The report pointed out that asset base of the banking system grew 2.6 percent over the quarter to reach Rs 5,653 billion, well supplemented by 3.6 percent and 7 percent growth in deposit and shareholders' equity, respectively.

Sensex slips almost 5 per cent, global markets in red

The 30-scrip Bombay Stock Exchange (BSE) sensitive index (Sensex), which opened at 10,036.8 points on Monday, ended at 9,568.14 - a fall of 480.35 points or 4.78 per cent from its previous close on Friday

Indian equities markets turned southwards on Monday, aping their global peers, and marked an end to last week's rally that saw a key index breach the psychologically important 10,000-mark and gain over 12 per cent.

Of the 13 sectoral indices on the exchange, the indices for banking, metal and realty stocks ended in the red, signifying heavy selling in such stocks, while healthcare and consumer durables stocks saw selling.
There were only two gainers on the 30-scrip composite Sensex: NTPC, up 0.8 percent at Rs 183.50, and Sun Pharma, up 0.25 per cent at Rs 1,082.20.

European markets, which came online before Indian bourses ended trade, were in the red with the FTSE in Britain trading 2.18 per cent lower than its previous close.

Oil Stockpiles Rise More Than Expected; Gasoline Demand Improves

Release Explanation: This is the DOE (Department of Energy) Crude Oil Inventory, EIA (Energy Information Administration) Weekly Oil Inventory. It measures changes in crude oil production, refinery inputs and utilization, production by product; current inventory level of crude and related products as well as an estimate of how many days of supply is currently available. Increasing or decreasing inventory figures leads to an adjustment of price action that in time will spread throughout the economy. Currently, it is estimated that for every one percent of GDP growth, oil consumption increases by one quarter to one third of a percent, so oil inventories must be able to increase along with the economy or another gasoline shortage may occur. It is also worth noting that at an average price of $75.00 a barrel, the U.S. spends one billion dollars a day on crude.

Trade Desk Thoughts: U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) increased 3.3 million barrels from the previous week. At 356.6 million barrels, U.S. crude oil inventories are above the upper limit of the average range for this time of year.

Demand for total products declined sharply compared to the same period a year ago, although gasoline demand improved" said Matthew Carniol, chief currency strategist at TheLFB-forex.com. "The slight improvement in demand for gasoline from a year ago could be a positive for oil prices."

Australia shares gain 1 pct; banks lead, Rio bounces

By Mette Fraende and Denny Thomas
SYDNEY, March 26 (Reuters) - Australian shares rose 1 percent
on Thursday, rising for a fourth straight day, with financials
buoyed by hopes of a revival in global growth on the back of
recent U.S. government efforts to ease the credit crisis.
Global miner Rio Tinto Ltd turned positive, ending
with a 1.4 percent gain, after its chief financial officer said
Rio could sell more assets and reschedule debt if Chinalco's
proposed $19.5 billion deal with Rio is not approved. .
A late rally in U.S. stocks on the back of unexpectedly
strong housing and durable goods data also helped supported
sentiment, traders said. 'Ever so slowly there's the smallest little current of less
than disastrous news coming out,' said Peter Wright, dealer at
Burrell & Co.
The benchmark S&P/ASX 200 index finished 37.3 points
higher at 3,646.6, based on the latest available data. The index
has risen 9 percent so far in March.