(Adds details, analyst comment)
NEW YORK, June 24 (Reuters) - Index provider MSCI said on Thursday it will reclassify the MSCI Argentina Index from Emerging Markets to Standalone Markets status during its November index review.
“The prolonged severity of capital controls with no resolution is not in line with the Market Accessibility criteria of the MSCI Emerging Markets Index,” said Craig Feldman, global head of index management research at MSCI.
“This has led to the reclassification of the MSCI Argentina Index from Emerging Markets to Standalone Markets status.”
The main implication of the move “would be forced divestments from (exchange traded funds) of close to $610 million from the three constituents of the MSCI Argentina Index,” according to JPMorgan analysts.
Tech services company Globant, consumer staples company Adecoagro and local energy major YPF are the index components, with Globant taking more than 81% of the weighting.
According to the JPMorgan analysis, Globant could see forced selling of about $494 million, while Adecoagro and YPF could see $63 million and $55 million in forced selling respectively. (Reporting by Rodrigo Campos Editing by Chris Reese and Alistair Bell)