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The MSCI world index, which is part of the modern index strategy, is a broad global equity index that represents large and mid-cap equity performance across 23 developed markets countries. It covers about 85% of the free float-adjusted market capitalisation in each country.
The MSCI world index does not offer exposure to emerging markets.
Craigs Investment Partners broker Peter McIntyre said yesterday the index rating was important for companies and signs had been pointing towards Mercury dropping out and The a2 Milk Company moving in.
When companies fell out of the index, they were sold off as they did not have the same weight for fund managers.
``There will be some active selling occurring.
``Mercury and Fletcher Building are the two likely candidates to fall out today, but Mercury is the most likely.''
Mercury's share price had fallen recently, he said.
The weekly rolling price for Mercury shares had been $3.27 to $3.17. However, the monthly rolling price had been down 6% from $3.40 to $3.08.
In contrast, a2 made up 8.5% of the NZX 50 and had a market capitalisation of about $9.5billion. Its shares had risen 2% in the past month.
There was also a good chance Xero would join the MSCI Australia and the MSCI world indices, Mr McIntyre said.
Changes take effect on June 1.