In a surprise move, MSCI in its Quarterly Index review announcement on August 10, 2023 added 15 Pakistan stocks to the MSCI Frontier Market Index and 41 stocks to the MSCI Frontier Markets Small Cap Index.

With addition of 15 stocks into MSCI FM index, the index has now a total of 17 constituents which includes OGDC, MARI, PPL, LUCK, MCB, UBL, ENGRO, HBL, POL, SYS, FFC, HUBC, EFERT, MTL, BAFL, PSO, and TRG. Earlier there was only two stocks namely OGDC and ENGRO. 

Similarly, MSCI FM Small Cap index has now a total of 41 constituents as shown in the table. Earlier there were 14 stocks in Frontier Small Cap Index.   

Pakistan has now 58 stocks in MSCI FM index, out of which 17 stocks are in MSCI FM Index and 42 stocks are in MSCI FM Small Cap Index.  

After this re balancing we estimate Pakistan’s weight is likely to increase from 0.6% to around 2-3%. 

The changes to MSCI Frontier Market index will be effective from August 31, 2023. 

To recall, Pakistan was reclassified into MSCI Frontier Market from Emerging Market in Nov 2021.

Foreign participants interest are back in Pakistan. In last 6 weeks, foreign corporates has done net buying of US$27mn.

Insite of FX issues, Pakistan Central Bank has been smooth in remitting foreign portfolio investment funds.