China welcomes entry into MSCI club
Inclusion on the Emerging Markets Index could lead to up to $12 billion of inflows
PHOTO: AFP
SHANGHAI:
China hailed the decision by index compiler MSCI to include it in its key emerging markets list, saying it was a signal of confidence in the world’s number-two economy. The agreement to admit mainland-listed big-cap stocks - allowing them to be traded by foreigners - comes after three failed attempts as China’s leaders aimed to expand its global market influence. Inclusion on the Emerging Markets Index could lead to up to $12 billion of inflows as many overseas investors measure the performance of their portfolios against MSCI indexes and are obliged to buy shares in them. MSCI’s nod also comes after the domestic market was rocked by painful plunges in 2015 and 2016, and a liquidity crisis fuelled by Beijing’s recent efforts to tighten credit over concerns the country’s massive debt could trigger a financial meltdown.
Published in The Express Tribune, June 22nd, 2017.
China hailed the decision by index compiler MSCI to include it in its key emerging markets list, saying it was a signal of confidence in the world’s number-two economy. The agreement to admit mainland-listed big-cap stocks - allowing them to be traded by foreigners - comes after three failed attempts as China’s leaders aimed to expand its global market influence. Inclusion on the Emerging Markets Index could lead to up to $12 billion of inflows as many overseas investors measure the performance of their portfolios against MSCI indexes and are obliged to buy shares in them. MSCI’s nod also comes after the domestic market was rocked by painful plunges in 2015 and 2016, and a liquidity crisis fuelled by Beijing’s recent efforts to tighten credit over concerns the country’s massive debt could trigger a financial meltdown.
Published in The Express Tribune, June 22nd, 2017.