This morning, the MSCI announced Pakistan’s inclusion in the emerging market index. Shortly after that, the first trading hour plunged PSX into negative. The decline has been claimed by many industry experts as a “Sell on news” event as the past few weeks experienced frenzy owing to the announcement. The market closed on 51813.19, a drop of 574.68 points. The market during the day saw a high of 54826.70 where as the lowest level it reached today was 51754.07 points.
The market frenzy during the last few days gave a great momentum to market, helping it reach record highs. But it witnessed a decline during today’s session. An analyst commented on today’s development saying, “It’s seen that the pre-emptive build up of any news tends to be much hyped where as markets experience a short-term correction post the announcement”.
He also said regarding the time duration of this correction that “This correction might last a few days or even a week but overall the market’s sentiment is going to be positive as this announcement is a very welcome development for the country”.
Commenting on how this announcement will unfold in near future, he said that “It is yet to be seen how much foreigners will contribute to market the official inclusion happens on 1st June”.
Pakistan has already out-performed the emerging market index ever since MSCI's announcement, Global X MSCI Pakistan ETF PAK outperformed the MSCI Emerging Markets Index, over this time frame; the MSCI Pakistan Index stood third due to its phenomenal performance in the list of total 25 nations that are a part of 25 MSCI – EM index.
Pakistan is first country since Qatar and the United Arab Emirates several years ago to win the frontier-to-emerging promotion. Pakistan's weight in the MSCI Emerging Markets index will be 0.10 per cent, which will take effect on June 1. The press release mentions that the three largest companies of the MSCI Pakistan Index are Habib Bank (23.72 per cent), United Bank (17.80 per cent) and Lucky Cement (16.92 per cent). Other companies that are to be included in the MSCI Global Standard Index (large cap index) consist of Engro Corporation, MCB Bank and Oil and Gas Development Company.
All Share Volume increased by 24.90 Million to 377.71 Million Shares. Market Cap decreased by Rs.93.08 Billion.
Total companies traded were 397 compared to 405 from the previous session. Of the scrips traded 154 closed up, 218 closed down while 25 remained unchanged.
Total trades increased by 12,801 to 128,598.
Value Traded increased by 0.30 Billion to Rs.23.39 Billion
|Engro Polymer & Chemicals||42,403,000|
|Dewan Farooque Motors||20,155,500|
|Lotte Chemical Pakistan||19,612,500|
|Dewan Salman Fibre||11,413,000|
|Sui Northern Gas Pipelines||9,903,500|
|Oil & Gas Development Company||7,614,900|
|Technology & Communication||19,080,000|
|Oil & Gas Marketing Companies||17,041,600|