KSE 100 Index

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KSE 100 Index
Foundation 1991 (1991)
Operator Karachi Stock Exchange Limited
Exchanges Karachi Stock Exchange
Constituents 100
Type Large
Weighting method Capital weighted index
Website www.kse.net.pk

Karachi Stock Exchange 100 Index (KSE-100 Index) is a stock index acting as a benchmark to compare prices on the Karachi Stock Exchange (KSE) over a period. In determining representative compaines to compute the index on, companies with the highest market capitalization are selected. However, to ensure full market representation, the company with the highest market capitalization from each sector is also included.

History

1991-2006 (Steady growth)

The index was launched in November 1991 with a base of 1,000 points. By February 2007, it had skyrocketed to 12,285 points.[1]

2007 (Record breaking growth)

KSE-100 index touched the highest ever benchmark of 14,814 points on December 26, 2007, a day before the assassination of former Prime Minister Benazir Bhutto, when the index nosedived.[2]

2008 Global crisis

  • April 20 : Karachi Stock Exchange achieved a major milestone when KSE-100 Index crossed the psychological level of 15,000 for the first time in its history and peaked 15,737.32 on 20 April 2008. Moreover, the increase of 7.4 per cent in 2008 made it the best performer among major emerging markets.[3][4]
  • May 23: Record high inflation in the month of May, 2008 resulted in the unexpected increase in the interest rates by State Bank of Pakistan which eventually resulted in sharp fall in Karachi Stock Exchange.[5][6]
  • July 17 :Angry investors attacked the Karachi Stock Exchange in protest at plunging Pakistani share prices.[7][8]
  • July 16 : KSE-100 Index dropped one-third from an all-time high hit in April, 2008 as rising pressure on shaky Pakistan's coalition government to tackle Taliban militants exacerbates concern about the country's economic woes.[9]
  • August 18: KSE 100 Index rose more than 4% after the announcement of the resignation of President Pervez Musharraf but Credit Suisse Group said that Pakistan's Post-Musharraf rally in Stock Exchange will be short-lived because of a rising fiscal deficit and runaway inflation.[10][11]
  • August 28 :Karachi Stock Exchange set a floor for stock prices to halt a plunge that has wiped out $36.9 billion of market value since April.[12]
  • December 15: Trading resumes after the removal of floor on stock prices that was set on August 28 to halt sharp falls.[13]

2009-2010 (Quick recovery)

The index recovered quickly in 2009 and 2010 reaching new highs. Basharullah said that you had to very careful about 2009 as it needs credible sources.

2011-2012 (Best emerging market)

As at 7 November 2012 index recorded highest level of 16,218 points and now KSE is being considered as a best emerging market in Asia with returns in financial year 2011-2012 up to 40%-50%.

2013-2014( post-elections)

As of April the 30th KSE-100 Index recorded a new increase in its value standing at 28,913 points, that is more than 45.2% since the last fiscal year of 2012-2013.[14]

Top 10 KSE 100 Index companies

The following is a list of the ten companies with the highest market capitalization volume and their respective weightages in the index. The companies account for over 74% of the KSE index, as of 9 July 2013:[15]

Number Company Name Weight (%) Market Capitalization
(PKR Millions)
1 Oil and Gas Development Company 16.21 147,193
2 MCB Bank Limited 11.64 105,729
3 Fauji Fertilizer Company Limited 8.86 80,490
4 Pakistan Petroleum 8.76 79,521
5 Pakistan Oilfields 6.31 57,352
6 Hub Power Company 6.16 55,987
7 Engro Corporation 4.35 39,551
8 United Bank 4.35 39,473
9 Pakistan State Oil 4.14 37,644
10 Lucky Cement 3.41 30,956

Market indices

KSE began with a 50 shares index. As the market grew, a representative index was needed. On November 1, 1991, the KSE-100 was introduced and remains to this date the most generally accepted measure of the Exchange. The KSE-100 is a capital weighted index and consists of 100 companies representing about 90 percent of market capitalization of the Exchange.

In 1995, the need was felt for an all share index to reconfirm the KSE-100 and also to provide the basis of index trading in future. On August 29, 1995, the KSE all share index was constructed and introduced on September 18, 1995.

The KSE 100 index reached its highest ever 32000.01 on 24 December, 2014.

See also

References

  1. ↑ KSE Index Monthly Report State Bank of Pakistan, February 2007
  2. ↑ Record-breaking spree at KSE on better earnings’ expectations Daily Times, December 27, 2007
  3. ↑ Karachi Stock Exchange reaches record high - Gulf News
  4. ↑ Monster & Critics
  5. ↑ Pakistan Stocks Slump, Led by Banks, After Unexpected Rate Rise - Bloomberg
  6. ↑ Billions wiped off on KSE’s ‘black Friday’ - Dawn.com
  7. ↑ Protest over Pakistan share slump - BBC News
  8. ↑ Pakistani Investors Stone Exchange as Stocks Plunge - Bloomberg
  9. ↑ Forbes.com
  10. ↑ Pakistan shares up on resignation - BBC News
  11. ↑ Pakistan's Post-Musharraf Rally Will Falter, Credit Suisse Says - Bloomberg
  12. ↑ Pakistan Stock Index Is Little Changed; Trading Limits Remain Bloomberg
  13. ↑ Pakistan’s Stock Index Falls to 2-Year Low After Lifting Curbs - Bloomberg
  14. ↑ [1]
  15. ↑ Lua error in package.lua at line 80: module 'strict' not found.

External links

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