MSCI delays China A shares decision
Sharemarket index provider, MSCI has again delayed including China A shares in the MSCI Emerging Markets Index.
MSCI confirmed its decision overnight, stressing the need for a period of further observation.
It said that while, over recent months, Chinese authorities had introduced significant improvements in the accessibility of the China A shares market for global investors and consultation had been positive, a period of observation was still required.
"In our 2016 consultation, investors recognised the actions taken to further open the China A shares market and highlighted that the topic of beneficial ownership had been satisfactorily addressed," an MSCI statement said. "However, they generally stressed the need for a period of observation to assess the effectiveness of changes in QFII quota allocation and capital mobility policies, and to monitor the effectiveness of new trading suspension policies."
It said that, additionally, the 20 per cent monthly repatriation limit remained a significant hurdle for investors, and local exchanges' pre-approval restrictions on launching financial products remained unaddressed.
"As a result of these concerns, MSCI will retain the China A shares inclusion proposal as part of our 2017 Market Classification Review. We don't rule out a potential off-cycle announcement should further significant positive developments occur ahead of June 2017," the MSCI announcement said.
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