Pakistan’s weight rises in MSCI Frontier Index

Pakistan’s weight has increased in the MSCI Frontier Index as Trinidad and Tobago was ousted from the index in the quarterly index review.

The country’s weight rose to four per cent from 3.79 per cent in the latest quarterly index review announced late on Monday.

Pakistan, with the sixth highest weight in the index, is the highest weighted among Asian countries that include Sri Lanka, Bangladesh and Vietnam.
The Karachi Stock Exchange imposed emergency trading limits to halt a slide in stocks that sent the benchmark index down 42 percent in 2008 within a couple of months.

Smart Airline launches 14 weekly flights to Pakistan

Islamabad—Nasair, the low fare airline based in Saudi Arabia, today announced it will launch new flights to Karachi, on June 18.

The airline will operate daily scheduled flights from both Riyadh and Jeddah airports. These flights will go on sale for an introductory price of SAR 499 inclusive of taxes.

The addition of Karachi to the nasair route network will bring the number of nasair’s international destinations to 19 cities. The flights will accommodate the growth in demand from Pakistani expats living and working in Saudi Arabia. Moreover, with the Hajj season rapidly approaching for the year 2011 this critical route expansion will help serve the nearly 200,000 pilgrims who fly to Saudi Arabia from Pakistan every year.

Banks propose changes in prudential regulations

Banks want to impose 30 percent margin on listed companies share financing. Besides this banks want their exposure in share markets to be protected by imposing eight new safeguards.

Sources of banking industry said on Monday that keeping best international practices in view the banks have drafted five major changes in prudential regulations meant for share markets of the country.

Sources said the proposed regulation number R-41 reads: Exposure against the shares of listed companies shall be subject to minimum margin of 30 per cent of their current market value.

Merrill Lynch bullish on Pakistan

“Sell Indonesia, buy Pakistan”, the international financial services firm, Merrill Lynch (ML) recommends Pakistan, Sri Lanka, Vietnam and Mongolia as ‘new frontiers’ in their latest regional investment strategy report released on Thursday (Feb 15).

Among the four countries, Spencer White, the strategist who prepared the report says: “Pakistan remains one of our highest conviction overweight recommendations”. He reasons that the on-going economic reforms remains a core priority and that it should sustain high economic growth and lead to further financial stability, something which ML “feels the market has under-appreciated”. Best exposure to Pakistan has been recommended on rural expansion focus companies, which ML identifies as Adamjee Insurance; MCB; United Bank and Fauji Fertiliser Bin Qasim.

How Much Bull Can You Take?

Last week was another good one for the stock markets; KSE-100 index gained about 500 points. The bulls ran rampant. The trend which started mid-January continued. The index gained more than 1, 000 points overall straight away, without any correction. The index, which started rising mid-January, is now above 11, 500 points. TNA, people: Total Non-stop Action.

What Happens When Beasts Roam the Earthen Markets

Needless to say, a stock market is a very interesting playground; things change quite quickly and decisively. A few days ago we saw a bearish trend in the market and now the trend has changed to bullish. These were the levels and prices where everyone was selling and leaving the market; now, everyone’s back on the wagon again, everyone wants to buy and make money.

Last week the bullish trend continued. The Index crossed 11,000 points once again. There was an overall increase in 464 points in KSE-100 index. Though it was the last week of January trading, buying was strong in that it did not affect the pursuant bullish trend. On Wednesday and Thursday, the Index increased by 150 and 175 points respectively.

The (Passed) Winds of Change: Part 1

The reports by the agencies below that came around mid-December have been issued pertaining to our present economic condition and a look into the future. SBP primarily touted foreign investments for last half year, drooling from the prospects of privatizations in the couple of years to come. And, as usual, there was some news directing the path of KSE. Let’s have a brief look on the reports first.

PSO sell-off attracts keen interest

The Privatisation Commission (PC) has received keen interest from several parties in response to the recent re-advertisement for the proposed sale of 51 per cent shares in Pakistan State Oil (PSO) with management control, the PC said on Wednesday.

Parties and groups submitting Statement of Qualifications (SOQs) and/or reaffirming their continuing interest in PSO include Abraaj Capital, UAE, Abu Dhabi Group, UAE, Al-Ghurair Investment, UAE, consortium of Aljomaih Group Saudi Arabia and Noor Financial Investment, Kuwait and National Industries Group, Bakri International Energy Systems and Dabbagh Group Holding, Saudi Arabia, Goldman Sachs (Asia) Finance, Vitol SA (Switzerland) and MCB Bank, Fauji Foundation, Attock Group of Companies and Kohinoor Group led by Kohinoor Textiles from Pakistan. In addition, some parties indicated their interest but did not submit SOQ, including the PSO employee group.

Standard Chartered to be listed on bourses

Badar Kazmi, Chief Executive Officer of Standard Chartered Bank (Pakistan) Limited, said on Monday that three bourses of the country have cleared listing application of the new banking entity and consent of Securities and Exchange Commission of Pakistan (SECP) will be obtained in coming weeks.

Addressing a press conference after unveiling re-branded branch at Khayaban-Hafiz, he said that after the listing, the present shareholding pattern will continue. He said the bank is in the process of preparing new liability products, which will offer new investment opportunities to deposit holders besides meeting the instructions of the central bank to the banks to offer such products having more rates of profit.

Foreigners hold 20pc of free-float on KSE

Foreign investment in the country’s capital market is generally dismissed as of little consequence and an ex-chairman of the Karachi Stock Exchange commented a little while ago that the market would be better off without it.

Such disillusionment stems from the mood swings of a foreign portfolio manager: “The outflow of funds is as quick as its inflow,” says a market guru. But the influence of the off-shore equity investment in the local bourses is growing.Admitting that the foreign funds hold just about 4 per cent of total market capitalization and the share of overseas funds in average daily volume is just about 3.5 per cent, analysts at the JS Capital Market have calculated that approximately 17 per cent of the share represents foreign investment in the float adjusted capitalization.