Ecopetrol’s stock has had a black week despite the good financial results delivered by the company. This Friday it collapses after learning that it left the MSCI Global ETF.
The stock falls 11% this Friday in the Colombian stock market and is trading at COL$2,297 with deals for COL$17 billion. The oil company has lost COL$302 during the day.
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We must bear in mind that the exit of Ecopetrol from the MSCI index, which also has Bancolombia shares, ordinary and preferred, as well as ISA, occurred on Thursday night due to the loss of liquidity of the share.
Experts have repeatedly warned that the Colombian market has great difficulties in attracting new issuers and investors and this is causing the volumes traded to fall constantly.
A few years ago something similar happened with the Peruvian stock market, which came to be classified as a frontier market since the volumes it traded daily were very small, making it unattractive for large foreign investors.
A frontier market is a type of developing country that is more advanced than less developed countries, but too small to be considered an emerging market.
It is not possible to objectively determine which are the markets whose listed assets can be included in this category based on defined conditions or declared economic variables.
However, it could be said that all countries that are not included in the MSCI All Country World Index are considered – at least from the point of view of institutional investors in developed markets – frontier countries.
If the volumes traded continue to decrease, and if they continue to lose participation in the MSCI indices, Colombia runs the risk of being considered one of these markets, along with Argentina, Jamaica, Bulgaria, Kenya, Lebanon or Sir Lanka, among others.
With information from Bloomberg Línea