Morgan Stanley Capital International (MSCI) will add shares of five new South Korea companies - Samsung Engineering Co., Celltrion Pham Inc. HLB Inc. ViroMed Co. and PearlAbyss Corp. - to its Korean equity index as of June 1, a move that is expected to further boost foreign investors’ appetite for the companies’ stocks.
New York-based global equity index provider MSCI said on Tuesday that shares of Samsung Engineering, Celltrion Pham, HLB, ViroMed, and PearlAbyss will newly join the MSCI Korea Index according to its annual index rebalancing result. But Hanwha Aerospace Co., Hyundai Wia Corp., and SK Networks Co. will leave the index. The changes will be effective as of June 1, the company said.
Of the five new stocks, three companies - Celltrion Pham, a subsidiary of Korea’s bio bellwether Celltrion, HLB and ViroMed - are biotech companies. Samsung Engineering is the construction arm of Samsung Group and PearlAbyss is an online game developer.
As MSCI Korea Index is widely tracked by global asset managers, market observers expect that the five newly added equities in the index would help further boost a foreign capital influx to the Korean stock market.
On Tuesday, shares of Samsung Engineering gained 1.52 percent and closed the day at 19,150 won ($17.83) and those of Celltrion Pham up 1.16 percent at 87,300 won. HLB shares ended 0.52 percent higher at 97,500 won, ViroMed shares up 4.09 percent at 196,900 won. PearlAbyss finished 5.36 percent higher at 238,000 won. Samsung Engineering shares are listed on the main Kospi and the rest are on the secondary Kosdaq.
Separately, MSCI said that 234 China A shares will be added to its global and regional indexes including the MSCI Emerging Markets Index. Total 11 companies will be added while nine will be removed from the MSCI China A inclusion index on June 1.
China A shares refer to stocks listed in Shanghai and Shenzhen stock exchanges that only authorized Chinese nationals and foreign investors are allowed to trade. Market experts predict minimum $1.5 billion will flow into China following China A’s inclusion in the MSCI Emerging Markets Index.
By Han Ye-kyung and Cho Jeehyun
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