Stock market joins ICB club

KARACHI - The Karachi Stock Exchange (KSE) has adopted the Industry Classification Benchmark (ICB), a jointly developed classification system launched by FTSE Group and Dow Jones Indexes, to classify and analyse specific sectors of the Pakistan stock market using internationally accepted standards. According to KSE here on Friday, the ICB provides a comprehensive system with four levels of granularity - industry (10), super sectors (19), sectors (41) and sub-sectors (114) and facilitates cross-border company comparison. ICB will replace KSEs own classification system after a transition period in which KSE will run both classification systems parallel to allow a smooth adoption process. ICB is the standard used by major stock exchanges, data distributors, index providers, buy side and sell side institutions, custodians and media organizations globally. KSE joins other exchanges and global financial institutions which have integrated ICB into their research, trading and investment workflows. These include NASDAQ, NYSE/Euronext, the London Stock Exchange, the Swiss Exchange, Aegon, the International Monetary Fund and the World Economic Forum, as well as media outlets including The Wall Street Journal, the Financial Times, CNBC and Dow Jones Newswires. While commenting, KSE MD Adnan Afridi said that the adoption of ICB will also assist the efforts to introduce tradable sector indices as part of our overall strategy to introduce derivative and structured products at the KSE. James Cemprola, Managing Director of ICB said that upcoming financial markets can strengthen their transparency, comparability and hence draw the attention of international market participants with the help of ICB.

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