Some Pandemic Plays Win MSCI Nod Just as Vaccine Optimism Grows

(Bloomberg) -- The burst of optimism around a Covid-19 vaccine this week has unwound some of the massive gains seen by Asia’s pandemic winners. Yet passive investors look set to allocate to several of these stocks as they enter MSCI Inc.’s indexes.

These include Japanese video-game makers Capcom Co. and Koei Tecmo Holdings Co., Thailand’s Sri Trang Gloves Thailand Pcl and Chinese electric scooter maker Yadea Group Holdings Ltd. The additions, which follow the index provider’s semi-annual review of its gauges, will be made as of the close of Nov. 30.

Asian companies that have benefited from the virus-induced healthcare crisis and lockdowns saw investors dump their shares in favor of travel-related stocks and cyclical names on Tuesday, as encouraging vaccine results fueled hopes that the world may soon have a way out of the pandemic. That rotation continued in early Asian trading on Wednesday, albeit with lesser intensity.

The MSCI’s review showed there were no additions from Singapore, Malaysia and the Philippines even as few stocks from these countries are set to be excluded by the index provider. It will include 56 securities from China while deleting 49, and Japan is poised to see 21 deletions against five additions. India will see 12 additions and two deletions.

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