Pakistan left unchanged in MSCI review

Country’s weight pruned by 0.03% down to 4.38%.

KARACHI: MSCI, a leading provider of investment decision support tools worldwide, has announced the results of its August 2012 review, with no changes to Pakistani constituents in the MSCI Frontier Markets Index. As per the press release, there is no deletion from and one addition to the MSCI Frontier Markets Index. The security added to the MSCI Frontier Markets Index is the Vietnamese company Petrovietnam Gas.

However, after addition of Petrovietnam Gas and tweaking in the weights of some other countries has lead to Pakistan’s weight being pruned by 0.03% to stand at 4.38% within the MSCI Frontier Markets Index.

A KASB Securities note says that while developments on Pakistan potentially being considered for an upgrade should be closely tracked, developments in other markets could also have an impact on Pakistan.

The note says that a UAE and Qatar upgrade, combined with any development on MSCI statement in the Annual Review that it could consider consulting investors on excluding Argentina from the MSCI Frontier Market Index, will be positive in terms of Pakistan’s weight in listing.

On the other hand, MSCI has also highlighted the possibility of Morocco and Saudi Arabia being included in the Frontier Market Index in the future, which would dilute Pakistan’s current weight of 4.4%, accord to KASB Securities.

Published in The Express Tribune, August 17^th, 2012.