China-MSCI Entry/Capital Inflow

MSCI entry to draw foreign funds to China stock market: analysts

  • English

Shotlist


Beijing, China - May 15, 2018 (CCTV - No access Chinese mainland)
1. MSCI website
2. Various of MSCI Equity Indexes May 2018 Index Review, in which MSCI said it will include 234 China A shares into its global, regional indexes

FILE: Shanghai, China - Date Unknown (CCTV - No access Chinese mainland)
3. Shanghai Stock Exchange trading floor
4. Electronic display showing stock information

Beijing, China - May 15, 2018 (CCTV - No access Chinese mainland)
5. SOUNDBITE (Chinese) Rong Ying, fund manager, China Asset Management (partially overlaid with shot 6):
"Roughly an additional 20 billion U.S. dollars will be invested in the A share market in the short term. Apart from that, the awareness of value investing will also be enhanced among investors in the A share market."

++ SHOT OVERLAYING SOUNDBITE ++
FILE: China - Date and Exact Location Unknown (CCTV - No access Chinese mainland)
6. Investors in brokerage house
++ SHOT OVERLAYING SOUNDBITE ++

FILE: Shanghai, China - Date Unknown (CGTN - No access Chinese mainland)
7. Various of MSCI website

Beijing, China - May 15, 2018 (CCTV - No access Chinese mainland)
8. SOUNDBITE (Chinese) Cheng Yimin, deputy general manager, research and development department, China Post Securities:
"The MSCI indexes are more suitable for passive investors seeking to purchase stocks in large amounts, so many investors should be willing to enter the market."

FILE: Shenzhen, Guangdong Province, south China - Date Unknown (CCTV - No access Chinese mainland)
9. Various of Shenzhen Stock Exchange building
10. Shenzhen Stock Exchange sign
11. Bull statue outside Shenzhen Stock Exchange building

FILE: China - Date and Exact Location Unknown (CCTV - No access Chinese mainland)
12. Investors monitoring stock prices in brokerage house
13. Electronic board showing stock information
14. Various of investor looking at computer screen showing stock information

Storyline


The imminent inclusion of 234 China A shares into the global and regional indexes of MSCI, the global index provider, is set to attract more foreign capital to the Chinese stock market, according to experts.

The MSCI announced on Monday that, as the first step of the partial inclusion of China A shares, 234 companies will be added to the MSCI China Index as well as relevant global and regional composite indexes by the end of May.

These China A shares, which refer to stocks traded on the Chinese mainland, will be added at 2.5 percent of their FIF (Foreign Inclusion Factor) adjusted market capitalization rate, representing aggregate weights of 1.26 percent in the MSCI China Index and 0.39 percent in the MSCI Emerging Markets Index.

Those set to be added into the widely tracked equity benchmarks include the Industrial and Commercial Bank of China, China Construction Bank and PetroChina, which are the three largest A share-listed companies by market capitalization.

With 12.4 trillion U.S. dollars in equity assets benchmarked to MSCI indexes worldwide, analysts say the inclusion will attract tens of billions of dollars to China's stock market via such programs as the Qualified Foreign Institutional Investors (QFII) and Renminbi Qualified Foreign Institutional Investors (RQFII).

"Roughly an additional 20 billion U.S. dollars will be invested in the A share market in the short term. Apart from that, the awareness of value investing will also be enhanced among investors in the A share market," said Rong Ying, a fund manager at China Asset Management.

Cheng Yimin, deputy general manager of the research and development department at China Post Securities, is similarly upbeat.

"The MSCI indexes are more suitable for passive investors seeking to purchase stocks in large amounts, so many investors should be willing to enter the market," said Cheng Yimin, deputy general manager of the research and development department at China Post Securities.

According to the MSCI, the May inclusion will be followed by a second round of entries scheduled for August, when the representation of the FIF-adjusted market capitalization of China A shares will increase to 5 percent.

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  • ID : 8080840
  • Published : 2018-05-16 16:46
  • Last Modified : 2018-05-16 16:46:59
  • Location : Beijing,China
  • Category : economy, business and finance
  • Duration : 1'26
  • Audio Language : Chinese/Nats/Part Mute
  • Source : China Central Television (CCTV)
  • Restrictions : No access Chinese mainland
  • Version : 2
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