Shares of Asia Pacific Telecom Co (APT, 亞太電信), one of the smaller domestic telecom operators, rose 1.96 percent to end at NT$18.20 yesterday after the stock was added to the Taiwan index of the MSCI Global Standard Indices, dealers said.
However, shares of Tripod Technology Corp (健鼎), a local printed circuit board (PCB) supplier, came under pressure as the stock was removed from the index following the latest semi-annual review by MSCI Inc.
Shares of Tripod dropped 4.48 percent to NT$51.2.
The TAIEX closed down 0.65 percent at 8,229.59 points.
“It is no surprise that Asia Pacific has attracted strong buying on the news of its inclusion in the MSCI Global Standard Indices,” Ta Ching Securities (大慶證券) analyst Andy Hsu said.
“As the MSCI indices have been followed closely by foreign investors, many local retail investors have high hopes that the stock’s inclusion will spark more foreign buying,” he said.
Even before the MSCI announced the index revisions overnight, foreign institutional investors had started buying into Asia Pacific shares, Hsu said, noting that such investors have bought about 90 million Asia Pacific shares since the beginning of last month.
Purchase interest was based partly from expectations that Asia Pacific would win a license for the fourth-generation (4G) telecom services in Taiwan and that it might form an alliance with other license holders.
The National Communications Commission said last week that Asia Pacific was one of the six groups that won bids in the license auction.
Tripod lost its status in the MSCI Global Standard Indices, but has been included in the Taiwan index of the MSCI Global Small Cap Indices along with 14 other domestic stocks — including property developer Advancetek Enterprise Co (名軒), auto part suppliers BizLink Holding Inc (貿聯) and Hota Industrial Manufacturing Co (和大) and shipper First Steamship Co (益航), MSCI said.
In the first half of the year, Tripod posted NT$2.18 in earnings per share, compared with NT$3.12 in the same period last year.
Meanwhile, MSCI has removed 14 stocks from the Taiwan index of the Global Small Cap Indices, including electronics component suppliers Ways Technical Corp (位速) and Aces Electronic Co (宏致) and sports equipment maker Advanced International Multitech Co (明安).
The index adjustments will become effective after the market closes on Nov. 26.