MSCI rebalancing perks up PSEi

The Philippine Stock Exchange index firmed up on Tuesday on a wave of selective buying influenced by the latest rebalancing review of MSCI indices.

The main-share Philippine Stock Exchange index added 18.14 points or 0.23 percent to close at 7,791.07 as investors factored in the changes in the MSCI index weights alongside the addition of Petron Corp. to the MSCI global small call index.

Apart from Petron, the latest MSCI rebalancing index largely buoyed Alliance Global Group Inc. whose index weight at MSCI Standard index was increased by 1.03 percent. On Tuesday, AGI was the most actively traded company, gaining 3.13 percent at the stock market.

The adjustment to the MSCI indices – which historically affect markets as they are closely followed by large global fund managers – will take effect at the close of trading on May 31.

Other PSEi stocks that saw index weight increases included GT Capital (+0.34 percent), SM Prime Holdings (+0.28 percent) and BPI (+0.26 percent). GT Capital and SM Prime gained 1.54 percent and 1.88 percent, respectively, while BPI was unchanged.

Petron gained 3.2 percent on news of its additional to MSCI global small cap index. Restaurant operator Max’s Group was removed from the same index.

On the other hand, the weights of following companies on MSCI Standard index were reduced: PLDT (-0.78 percent); Ayala Land (-0.16 percent); JG Summit (-0.13 percent); BDO (-0.13 percent) and AC (-0.11 percent).

PLDT and JG Summit both fell by over 2 percent while despite the weight cut, Ayala Land and AC gained 3.87 percent and 0.23 percent, respectively. BDO shares were unchanged.

On the MSCI global small-cap indices, leading canned food producer Century Pacific and Xurpas both gained weights, by 0.6 percent and 0.32 percent, respectively. On the other hand, there was a reduction in the weights assigned to Bloomberry Resorts Corp., Manila Water, DoubleDragon and Vista Land.

By counter, the property sub-index gained the most, rising by 2.48 percent. The rest of the indices declined.

Value turnover for the day amounted to P8.29 billion. Despite the PSEi’s slight gain, market breadth was negative as there were 106 decliners that outnumbered 92 advancers while 49 stocks were unchanged.

Foreign investors were net buyers in the local stock market, resulting in net inflows of P761.72 million for the day.

Meanwhile, the initial public offerings of Eagle Cement Corp. and Cebu Landmasters are seen siphoning off liquidity from the local market in the days ahead.