MSCI Inc, a global index provider, has cut Taiwan’s weighting in two of its major indices while raising it in a third index after a quarterly review.
Taiwan’s weighting in the MSCI Emerging Markets Index, which is closely watched by foreign institutional investors, has been cut by 0.07 percentage points to 14.75 percent, it said in a statement yesterday.
It was the steepest cut among the emerging markets in that index, and Taiwan’s weighting in the MSCI All-Country Asia ex-Japan Index was also lowered, to 16.48 percent from 16.56 percent.
However, the index provider raised Taiwan’s weighting slightly in the MSCI All-Country World Index, to 1.66 percent from 1.65 percent.
After the quarterly index review, no Taiwanese stocks were added to or removed from the MSCI Global Standard or Global Small Cap indices, it said.
In the Asia-Pacific region, only stocks in China, South Korea and Thailand were added to or removed from the MSCI Global Standard and Global Small Cap indices, it said.
China saw the biggest hike in weighting in the MSCI Emerging Markets Index, with a 0.27 percentage point raise, followed by Qatar with an increase of 0.03 percentage points.
In the MSCI Taiwan Index, the number of constituents remained at 87 after the quarterly adjustments.
Before the latest adjustments were announced, market analysts had forecast that some biotech and old economy stocks in Taiwan would have been added into the MSCI Taiwan Index, given their recent gains.
Meanwhile, high-speed transmission stocks and semiconductor stocks were expected to be removed, as rising interest rates had dwarfed their dividend yields, pushing their shares lower.
MSCI said it adjusted the weighting of 19 stocks in the MSCI Taiwan Index, with China Airlines (華航) seeing the biggest rise of 0.01 percentage points, while metal casing supplier Catcher Technology Co (可成科技) had the steepest cut of 0.02 percentage points.
The index adjustments are scheduled to take effect after the Taiwan market closes on Aug. 31.
MSCI index reviews are conducted in February, May, August and November each year.
Analysts said that the latest MSCI index adjustments had little effect on the TAIEX, the weighted index on the Taiwan Stock Exchange, which continued to gain yesterday, rising 0.60 percent to close at 15,288.97.
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