Morgan Stanley Capital International bolsters Pakistan’s market presence with 22 new additions to its indices.
Story Snapshots:
- MSCI announced the addition of 22 Pakistani companies to its indices.
- Three companies were added to the Frontier Market Index, 19 to the Small Cap Indexes.
- The changes are set to occur at the close of February 29, 2024.
- Pakistan’s weight in the MSCI Index is expected to be around 3%.
What recent updates has MSCI made to its Frontier Market Index and Small Cap Indexes concerning Pakistani companies? MSCI has added 22 Pakistani companies to its Frontier Market Index and Small Cap Indexes, with changes effective from the close of February 29, 2024, and this is expected to adjust Pakistan’s weight in the index to around 3%.
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In a significant move for Pakistan’s financial markets, Morgan Stanley Capital International (MSCI) Inc. has announced the addition of 22 Pakistani companies to its Frontier Market (FM) Index and FM Small Cap Indexes following its February 2024 review. This upgrade is set to take effect at the close of February 29, 2024.
The MSCI FM Index will now feature Bank Al Habib Limited, Interloop Limited, and Sui North Gas Pipelines Limited (SNGPL). In addition to these, the MSCI FM Small Cap indexes will include 19 more Pakistani companies. The broadened representation spans across various sectors, with Adamjee Insurance Company, Agritech Limited, Aisha Steel Mills, and many others, making the list.
This inclusion is a positive development for Pakistan’s financial market, which saw a downgrade from its emerging market status in September 2021, just over four years after it was reclassified from the FM Index by MSCI. At that time, MSCI noted that while Pakistan’s market met the accessibility requirements, it fell short on size and liquidity standards for emerging markets.
Pakistan’s weight in the MSCI Index is anticipated to rest at approximately 3% after this review, as reported by Topline Securities. The addition is expected to trigger some net flows into the market, though the overall impact is projected to be modest.
The adjustment in the indices comes as a significant step for Pakistan’s market, indicating a recognition of its growing potential and a more diversified investment landscape within the MSCI indices.
As Pakistani companies prepare for their induction into the MSCI indices, market watchers will be keen to observe the impact on investment flows and overall market dynamics. This inclusion marks a positive trajectory for the nation’s financial standing on the global stage, promising enhanced visibility and potentially drawing more international investments to Pakistan’s burgeoning market.
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