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MSCI retains Pakistan in its EM index

In line with market consensus, Pakistan maintained its weight of around three basis points in the MSCI Emerging Market index with all three constituents of the MSCI Pakistan index, namely Habib Bank Limited, Oil and Gas Exploration Company and MCB Bank retaining their place.

The three companies posted combined market capitalisation at $2,674 million eking out MSCI weight at 0.03 per cent.

MSCI — the New York-based leading provider of research-based indexes and analytics unveiled results of its November semi-annual review for the MSCI Equity indexes including MSCI Global Standard index and MSCI Global Small Cap index on Friday, which would go into effect from Nov 26.

In MSCI Global Standard indexes, a total of 278 securities have been added while 69 securities deleted.

The three largest additions to the MSCI Emerging Market (EM) index include two Chinese and one Indian company.

Overall, on global perspective in the MSCI Global Small Cap index, there are 311 additions and 234 deletions. From Pakistan there are three deletions, namely D. G. Khan Cement (DGKC), Kot Addu Power Company (Kapco) and Thall Ltd (THALL).

In the MSCI Small Cap index, 16 companies retained their positions, which include Engro, United Bank Ltd, Fauji Fertiliser, Lucky Cement, Hub Power Co, Pakistan Oilfields, Engro Fertilisers, Pakistan State Oil, Bank Alfalah, Sui Northern Gas, Searle, National Bank of Pakistan, Nishat Mills, Millat Tractors, Worldcall Telecom, Indus Motors and Packages Ltd.

With aggregate market capitalisation at $3,916m, the companies have minuscule weight of 0.067pc in the index.

Overall, the MSCI review was thought to be neutral for the market performance. However, the companies deleted from Small Cap Index including DGKC, Kapco and THALL were likely to witness some selling from passive funds, analysts and traders said.

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