Evraz, Polymetal, Petropavlovsk excluded from FTSE indexes - VTB Capital

MOSCOW. March 14 (Interfax) - Index provider FTSE has announced the exclusion of Evraz, Polymetal and Petropavlovsk from its indices, according to a review by VTB Capital strategists Daria Batyshkina and Andrei Kuznetsov.

The change will take effect on March 18 after the close of trading.

Experts estimate that passive capital outflow from Polymetal and Petropavlovsk shares will amount to about $90 million and $9 million respectively. The passive outflow of funds from Evraz securities at the resumption of trading on the LSE may total about $70 million.

"FTSE made the decision following consultations with external advisers and market participants: according to their estimates, the ability to buy and sell shares of these companies has sharply decreased after major international brokers stopped supporting trading in these securities, which has caused insufficient liquidity and market depth for institutional investors. This leaves it impossible for index funds to maintain the weighting of these securities in their portfolios in line with their weights in the FTSE indices. After consideration of the issue by the FTSE index committee, a decision was made to remove the mentioned instruments from all of the provider's indexes," the investment bank said in the review.