Monde Nissin Deletion and Downweights in Other Stocks To Weigh on Local Market
The MSCI recently announced that it will delete Monde Nissin from its standard index effective at the close of May 31. With its removal, the number of MSCI Philippines stocks will shrink to 14. For the upcoming rebalancing, every MSCI Philippines index component will receive outflows, expect for Ayala Corporation where it is expected to see an estimated $49.80 million in inflows from passive funds. Estimated outflows from Monde are $84.10 million. Other significant outflows due to weightings downgrade are SM Prime -$79.30 million, JG Summit -$30.70 million, Ayala Land -$28.40 million, and PLDT -$20.70 million. The total estimated outflows are $224 million (including the downweight in other names) or Php12.54 billion which will be sold solely on the rebalancing day of May 31 (majority of it will be executed at the auction period of the afternoon session). The above expected outflows from passive funds will therefore weigh on the local market in the next few days.
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*Consensus target price or average target price given by the major foreign and local brokers of various stocks on top of index names are available in our Equity Advisor!
