Market Daily: MSCI ejects ENGRO from EMI

Yet another blow, KSE 100 falls 0.7pc

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LAHORE: Trading at the bourse on Tuesday was underpinned by MSCI’s overnight announcement where the leading index provider ejected Engro Corporation (ENGRO) from MSCI Emerging Markets Index, while no addition has been made to the aforementioned index. To add to the struggle, Pakistan Stock Exchange has declined 491.92 points in the first two days of the week and investors fear that it might continue this trend.

Resultantly ENGRO crashed 5 per cent with only 0.66 million shares exchanging hands. On the flipside, some respite was perceived on the external front given an allowance of $ 3 billion borrowing from international debt markets. The PSX dropped 18.10 per cent since its inclusion.

At close KSE-100 was down 0.7 per cent; activity improved as volumes rose 60 per cent while value was up 57 per cent.

Only five companies now remain part of MSCI EM Standard Index (Large and Mid Cap) which includes Oil and Gas Development Company Limited (OGDC -2.16 per cent), Habib Bank Limited (HBL +1.07 per cent), United Bank Limited (UBL -1.25 per cent), MCB Bank Limited (MCB -1.98 per cent) and Lucky Cement Limited (LUCK +0.30 per cent). ENGRO has been downgraded to MSCI Global Small Cap Indexes, whereas, Pak Suzuki Motors Limited (PSMC -2.44 per cent), Shell Pakistan Limited (SHEL -1.79 per cent) and Ferozsons Laboratories (FEROZ -1.37 per cent) have been removed from the small-cap index.

The benchmark KSE 100 index depreciated to an intraday low of 40,899.50 with a 340.39 points decline and settled 296.11 points lower at 40,943.78. The KMI 30 index laid off 852.42 points to reach 70,549.61 while the KSE All Share Index lost 188.44 points. The advancers to decliners ratio stood at 137 to 195.

The market volumes rolled higher to 140.09 million from last sessions 87.44 million. Azgard Nine Limited (ANL +4.87 per cent) led the volume chart with 18.58 million shares exchanged followed by TRG Pakistan Limited (TRG +1.86 per cent), volume 19.17 million, and K-Electric Limited (KEL -2.50 per cent), volume 7.54 million.

It was again a close in the red for many sectors. The commercial bank sector lost 0.61 per cent from its cumulative market capitalisation. Oil and gas sector depreciated by 1.70 per cent and the cement sector took a 0.24 per cent hit on its market cap.

Pakistan Suzuki Motors Company Limited (PSMC -2.44 per cent) sales were up 36 per cent to 46,941 units in the July-October 2017 period. Honda Atlas Cars (Pakistan) Limited (HCAR -0.74 per cent) car sales grew 55 per cent to 17,110 units. These figures were released by the Pakistan Automotive Manufacturers Association (PAMA). Total industry sales for the month of Oct-17 clocked in at 30,118 units (up 18 per cent/41 per cent MoM/YoY).

Channel checks suggest that domestic DAP prices are increasing in line with rising international prices, DAP prices up by $ 21 per tonne, WoW, ending Nov 10. Local producer FFBL will raise prices by Rs 50 per bag whereas the importers have raised Rs 50-200 per bag.

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