Bharti Airtel and PFC could turn the market around today. Here's why

Bharti Airtel is up 1.27 percent, Idea Cellular has gained 0.5 percent and Power Finance Corporation (PFC) is up 1 percent. On the other hand, Indiabulls Real Estate is down 2.2 percent, HDIL is down 1.63 percent and Steel Authority of India (SAIL) is down 2.7 percent.

So what’s the connection among telecom, realty and infra stocks?

[caption id=“attachment_144499” align=“alignleft” width=“380” caption=“If the additional turnover is anywhere close to Rs 5,000 crore experienced in May 2011when the MSCI was last churned, today’s trade will have a significant impact on the market. Reuters”]  [/caption]

The answer is Morgan Stanley’s Capital International (MSCI) list. MSCI has added Bharti, Idea and PFC to its list and left out HDIL, SAIL and Indiabulls real estate. The index is reconstituted every six months and draws foreign money. For foreign institutional investors, or FIIs, it is a benchmark index for their India fund and FIIs would exit stocks that are left out and buy those stocks which are included.

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Markets could also see huge volumes towards the end of the trading day as there could be arbitrage opportunity between cash and future options of the stocks. BSE product and strategy head Sayee Srinivasan told PTI, based on past experience, that FIIs will be looking to execute all their trades in these stocks in the last 30 minutes at the volume weighted average price. If the additional turnover is anywhere close to Rs 5,000 crore experienced in May 2011when the MSCI was last churned, today’s trade will have a significant impact on the market.