Global index provider MSCI is quadrupling the weighting of Chinese mainland shar...
NEW YORK/SHANGHAI - Global index provider MSCI is quadrupling the weighting of Chinese mainland shares in its global benchmarks later this year, a move it said might draw more than $80 billion of fresh foreign inflows to the world’s second-biggest economy.
MSCI also said that it will add Chinese mid-cap stocks to its emerging market benchmark in November, boosting the number of Chinese constituents. “Inclusion should boost investor sentiment and, over the long term, flows into China,” Caroline Yu Maurer, head of Greater China equities at BNP Paribas Asset Management, said in a note.”It also helps advance President Xi Jinping’s ambitions to make the renminbi a global currency,” she said.
On completion of the three-step implementation, the weighting of Chinese stocks in the MSCI Emerging Market Index will jump to 3.3 percent, from roughly 0.7 percent currently. Rival index publishers FTSE Russell and S&P Dow Jones Indices will both start adding yuan-denominated Chinese shares to their global benchmarks this year as Beijing steps up efforts to integrate China’s capital markets into the global financial system.
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