Ecopetrol's stock falls on the stock market after being removed from the MSCI index

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The shares of the Colombian oil company fell more than 12% at the worst moment of the day

Ecopetrol's share falls on the stock market after being removed from the MSCI index

With the withdrawal of Ecopetrol from the MSCI indexes, only two Colombian companies remain: Bancolombia and the electric company ISA. REUTERS/Luisa González

This Friday the shares of the state company Ecopetrolthey fell 8% on the Colombian Stock Market, this was due to the fact that at the close of the volatile day the company was withdrawn from the indicator of US capital funds MSCI.

Thus things, the shares of Ecopetrol traded on the Colombian stock market fell more than 12% at the worst moment of the day, 2,252 pesos (0.47 dollars), but on closing they had a slight recovery and stood at 7 .77%, at 2,397 pesos (0.50 dollars).

According to economic analysts consulted by the specialized media Portafolio, Ecopetrol's removal from the MSCI index “reflects the drop in the share price in pesos and the devaluation of the Colombian currency, which make that the market value of the outstanding shares does not meet the standards of said methodology to remain in the index.”

MSCI indices are produced by MSCI Inc, formerly Morgan Stanley Capital International, hence the acronym. They are made up of a series of reference values ​​that, as a whole, they reflect in a representative way the evolution of the most important markets in the world: the American, the Japanese, the European or, directly, the global, among many others.

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With Ecopetrol's withdrawal from MSCI indices only two Colombian companies remain: Bancolombia and the electric company ISA.

On the other hand, spokespersons for the national oil company confirmed to Portafolio that “however, regardless of its departure from MSCI, Ecopetrol maintains its solidity and proof of this are the record results obtained until September”.

In an interview with El Espectador, Felipe Camos, Alianza Valores investment and strategy manager, explained that: “There are many international funds that invest based on these Morgan Stanley indices, so Ecopetrol flows are expected to flow once it is withdrawn of the MSCI Colombia on November 30. For now, the scale of the impact is not clear, it could come out between US$200 and US$300 million.”

It must be remembered that as of September 2022 the oil company reached production levels who had not seen each other since before the pandemic, which allowed reaching a net profit of $26.6 billion. During the third quarter, which runs from July to September, the company led by Felipe Bayón reported revenues of $43.43 billion, while profits reached $9.51 billion.

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According to President Bayón, These achievements are the result of “significant advances in the operational, geographic and commercial diversification strategy”. In addition to this, he said that the “strength, stability and reliability of the various segments of the operation are also highlighted, with which the positive path continues to be maintained”.

“Our strict cost and capital discipline has undoubtedly also allowed us to capture accumulated efficiencies of more than $1.8 trillion, with which we have reached the goal proposed for all of 2022 in just nine months, a message that is important for the market” he pointed out.