KARACHI: MSCI, a leading provider of investment decision support tools worldwide, announced the results of the June 2012 Annual Index Review for MSCI Equity Indices.
The results showed no major change for Pakistan.
The key takeaways from Pakistan’s vantage point were mostly negative, commented analysts at KASB Securities.
Detailing implications for Pakistan, the analysts observed that Pakistan had failed to get a mention, despite MSCI having invited feedback on Pakistan’s case for an upgrade in last year’s review.
UAE and Qatar upgrade (and expected weight-age gains for Pakistan) failed to materialise, while MSCI highlighted the possibility of Morocco and Saudi Arabia being included in MSCI Frontier Market (FM) in future, which would dilute Pakistan’s current weight of 4.4 per cent in MSCI FM.
In what could be termed as a sole positive, MSCI stated that it could consider consulting investors on excluding Argentina from MSCI FM, which would yield nominal weight-age gains (0.15pc) for Pakistan.
Nauman Khan, analyst at Topline Securities, stated that within Frontier Markets index that consists of 25 FM, no addition or deletion was conducted.
Reclassification of UAE and Qatar from FM to Emerging Market (EM) has not been done that could have increased Pakistan weight-age in the FM.
Furthermore, UAE and Qatar indices remained in the potential reclassification list to EM at the next annual market classification review in June 2013.
On the other hand, MSCI Morocco Index had been added to the list of potential reclassification to FM markets that could reduce Pakistan's weightage in FM going forward.
Furthermore, there was no announcement regarding Pakistan potential up-gradation to EM, analysts said.
At present, MSCI Pakistan includes 12 companies with overall weightage of around 4.4 per cent.