Stocks of Apollo Hospitals, Oil India, Wockhardt and GlaxoSmithKline Consumer Healthcare gained between one and nine per cent on the bourses on Thursday after Morgan Stanley Capital International announced that they will be included in its India index.
The changes will take place after the close of trade on May 31, MSCI said in a statement.
Apollo Hospitals was the biggest gainer, as the stock jumped 8.5 per cent to Rs 1,048. Intraday, the stock surged to Rs 1,060, new high since its listing.
Oil India, which is one of the three largest additions after Shin Corporation PCL (Thailand) and Suzano Papel E Celulose (Brazil) to the MSCI Emerging Markets Index, surged to a high of Rs 605 before settling at Rs 598.60, a gain of 3.1 per cent.
GlaxoSmithKline Consumer Healthcare also recorded a new high in Thursday’s trading at Rs 4,808 on the BSE before settling at Rs 4,783.45, a gain of 7.66 per cent over the previous day’s close.
Wockhardt closed at Rs 1,848.10, a gain of one per cent over Wednesday's price. Intraday, it touched a high of Rs 1,909.85.
‘No deletions’
There have been no deletions from the MSCI India index, the index provider added.
Changes in MSCI indices are keenly watched by global investors, as many global mutual funds and exchange traded funds are linked with MSCI indices. Hence, any changes in MSCI index will require the fund tracking that index to reflect that in their portfolio.
According to a Dow Jones report, about $1.4 trillion is benchmarked to the MSCI Emerging Markets index.
Empirical study suggests that the stocks added to the indices experience a sharp rise in prices after the announcement and a further rise during the period preceding the actual change, though part of the gain is lost after the actual change date.
The stocks that are deleted from the indices witness a steady and marked decline in their prices.
Trading volumes increase significantly and remain at high levels after the change date for the added stocks.
badrinarayanan.ks@thehindu.co.in