Posted by: 1pakistani | March 25, 2009

MSCI to reclassify Pakistan in Frontier Index

KARACHI: The Geneva-based MSCI Inc announced on Monday that following consultation with the investment community, it had been decided to reclassify MSCI Pakistan Index as MSCI Frontier Markets Index.

A notice from MSCI Inc introduced itself as a leading provider of investment decision support tools worldwide, including indices and portfolio risk and performance analytics.

‘Some participants to the consultation have positively highlighted the return to normal trading conditions on the Karachi Stock Exchange and the resulting increased liquidity,’ MSCI stated. And it added that a majority of market participants, nonetheless, stressed the need for the Pakistani equity market to function without any trading disruptions for some time as a condition to any potential consideration of the MSCI Pakistan Index for re-inclusion in the MSCI Emerging Markets Index.

In addition, the MSCI Pakistan Index no longer met the size requirements set for the MSCI Emerging Markets Index. ‘Consequently, the MSCI Pakistan Index will be included in the

MSCI Frontier Markets Index as of the close of May 29 to coincide with the May 2009 Semi-Annual Index Review,’ the announcement concluded.

Analysts here commented that although a step down from the ‘Emerging Market’ index, from which the country was pushed out following the fixation of ‘floor’ at the stock markets, the development was positive for the country’s capital markets. ‘Even if as a distant spot, this brings Pakistan back on the radar screen of foreign investors,’ said a stock broker.


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