Stocks that were widely expected to be added to MSCIs indexes, including EAFE, but were not included in the revisions announced Saturday generally were under selling pressure today, said Jonathan Cohen, product strategist at Northern Trust Global Investments.
Investors evidently were trying to unload positions taken in the stocks in what turned out to be misplaced expectations that they would be added to the indexes when they shift to free-float weightings. BMW, which was among the stocks, was down 150 basis points, while the German DAX index benchmark was up 100 basis points, based on preliminary numbers.
Stocks already in the indexes whose weightings fell in the revision also generally were under pressure today. Nippon Telephone & Telegraph, whose weighting in the EAFE index will fall to about 25 basis points from about 100 basis points in the revision, was up only 39 basis points today, compared with a rise of 215 basis points for the Nikkei 225 index benchmark.