May 08, 2008	Thursday	Jamadi-ul-Awwal 2, 1429

KARACHI, May 7: Two Pakistani companies, Pakistan Telecommunication Company Ltd (PTCL) and JS Capital, found their way into the MSCI Global Standard Index, which increased the weight of the country within the index by 2bps to 0.18 per cent from 0.16 per cent.

Rebalanced in Geneva on Wednesday, 19 countries, out of 25 that constitute the MSCI Emerging Market Index, saw change in their weight.

The Indian markets lost 4bps from 7.20 to 7.16 and Korea saw the biggest loss of 29bps. Rest of the five countries added more weight to the index and Brazil stayed put. That country, nonetheless, continues to be the single largest in the group with weightage of 15.89 per cent. The fast growing Chinese market saw its index gain the highest 80bps, carrying its weight to 15.77 per cent-second highest on the scale after Brazil.

Analyst Faraz Farooq wrote in his report: The development “holds broad implications for foreign investors (particularly equity investors) who benchmark their portfolio with the weights assigned to a particular market and the respective scrips at the time of funds allocation”.

Simultaneously, seven Pakistani companies have been deleted from the MSCI Index. That should have resulted in a drop in Pakistan weight in MSCI EM Index. But the benefit accrued as larger number of exclusion of companies was witnessed for other markets in EM.