MSCI upgra­da­tion opens door for for­eign in­flows

Pakistan Observer - - ECONOMY WATCH -

AMANULLAH KHAN KARACHI—For­eign in­flows up to $ one bil­lion into Pak­istan stocks likely fol­low­ing upgra­dataion of Pak­istan Stock Ex­change by MSCI to Emerg­ing Mar­ket sta­tus. It is be­lievd the ripple ef­fect would also be vis­i­ble in EFERT, PPL, DGKC, MCB, OGDC and K Elec­tric stocks. The sta­tus to emerg­ing mar­ket in act is a big en­dorse­ment of gov­ern­ment’s eco­nomic re­form pro­gram, im­proved in­sti­tu­tional frame­work for cap­i­tal mar­ket reg­u­la­tions and strong in­vest­ment cre­den­tials.

Ac­cord­ing to mar­ket an­a­lysts, net for­eign flows as­so­ci­ated with the re-clas­si­fi­ca­tion has gained added im­por­tance given in­vestors’ ex­pe­ri­ence in Qatar and UAE, two mar­kets which saw pre-buy­ing by lo­cals and sig­nif­i­cant mar­ket run-up (46-70% re­turn) from MSCI an­nounce­ment of up­grade lead­ing to ac­tual in­clu­sion. Mean­while KSE-100 In­dex which in a high pro­file added yet an­other 191 points to close in green at 38,751.61 lev­els here on Thurs­day, the mar­ket mood in­di­cates that it may soon cross the un­prece­dented level of 40,000. Amid a mar­ket vol­ume of 255 mil­lion shares, K ELEC­TRIC al­ready in a high pro­file re­tained its po­si­tion as the vol­ume leader with a trade of 22 mil­lion shares to their credit while PIBT and PTCL were sec­ond and third vol­ume lead­ers with a re­spec­tive trade of 21 mil­lion 13 mil­lion shares to their credit.

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