Saudi shares extend rally on new crown prince, MSCI; Qatar rebounds

Share
Saudi shares extend rally on new crown prince, MSCI; Qatar rebounds

Weighting of A shares in MSCI indexes would be increased gradually.

Inclusion in the index marks a key victory for the Chinese government, which has been working steadily over the past few years to open up its capital markets, investors said.

Benchmark providers take into consideration the quality of regulation and supervision when deciding how to classify a country, but they do not screen individual companies for corporate governance issues when adding them to global benchmarks.

As with the IMF's SDR decision, the MSCI move carries more symbolism that practical import for now. It listed Saudi Arabia on its watch list for potential classification as an emerging market.

It was a historic day for Chinese financial markets yesterday with the nation's mainland-listed stocks gaining admission to the MSCI's indices after three unsuccessful attempts, paving the way for increased foreign investment in the years ahead.

The development punctuates an extraordinary period during which China has sought to enter the mainstream of worldwide finance while still maintaining a semblance of control over its markets.

Shares of iShares MSCI Frontier 100 ETF (FM) traded down 0.02% during trading on Tuesday, hitting $28.84. However, with the rapid advancement in technology and information flow, and with political will, we believe China is likely to reach full inclusion in worldwide indices. 270,839 shares of the stock were exchanged. iShares MSCI Frontier 100 ETF has a 52 week low of $23.90 and a 52 week high of $29.58.

"For global investors, while the inclusion will not trigger an immediate and wholesale change in their asset allocation, it will put Chinese equities on the map". The first link with Shanghai started in late 2014.

"These companies have the highest proportion of passive-index focused investors on their registry and these are the stocks that are likely to see the most selling as the global and regional passive funds re-allocate to the A-Shares".

Concerns about the ability of foreign investors to move freely into and out of A shares led MSCI to withhold its approval in previous reviews, though.

The Singapore Exchange (SGX) reported that "more than half of the stocks" listed on the benchmark Straits Times Index (STI) are reporting revenues to China.

However, observers said the small number of firms taking part - 222 large-cap firms will join initially meaning they make up just 0.73 per cent of the overall index - meant there would be little early impact. In Asia, Japan's Nikkei 225 index fell 0.5 percent, South Korea's Kospi lost 0.5 percent and the Hang Seng in Hong Kong dropped 0.6 percent.

These A-share stocks only account for 0.73 per cent of the index's weighting, based on a 5 per cent initial inclusion factor. Returns in the stock market may often mimic the amount of risk.

China has been gradually opening its A share market to foreigners, allowing them to trade selected stocks in Shanghai and Shenzhen through mechanisms linking those markets to Hong Kong.

Share

Advertisement

Related Posts

Senate close to vote on dismantle health law
He concluded: "So if you're frustrated by the lack of transparency in this process, I share your frustration wholeheartedly". Spicer said that instead of pointing fingers at Republican lawmakers, Democrats should look closer to home .

Los Angeles Lakers, Brooklyn Nets both benefit from Russell-Lopez swap
This made sense, Russell is a score first guard and would be better suited at the two alongside a playmaker like Ball. The Lakers have jumped into trade talks, as well, in an effort to land George a year before he hits free agency.

Amazon stumps up nearly $US14B for Whole Foods Market
The app would then have automatically charged whatever products they took out of the store with them to their Amazon account. Analysts say the Whole Foods footprint and distribution channel could theoretically make 5-minute deliveries a reality.

Pacers unhappy with offers from Lakers, Cavs and Rockets — Paul George trade
The Rockets would be renting George and hoping his time in Houston would convince him to re-sign following the season. Miami doesn't have many draft picks to offer IN , as the Heat don't own both of their picks IN a draft until 2022.

Democratic Losses in Special Elections
Associated Press writers Matthew Daly, Kevin Freking, Stephen Ohlemacher and Andrew Taylor contributed to this report . Others are pointing the finger directly at Nancy Pelosi , calling for a change in leadership.

After high-profile losses, some Democrats seek change at the top
Tim Ryan's challenge to Pelosi's leadership post previous year - said: "I think that's a question for the caucus to decide". Of the political impact of the Republican attacks: "I think I'm worth the trouble", she said.

Confed Cup: Chicharito Scores As Resilient Mexico Hold Portugal
But Portugal's Ricardo Quaresma scored the opener on 34 minutes before Javier Hernandez equalised with a low header for Mexico . Compared to Sunday where Carlos Salcedo and Diego Reyes played right backs and were more conservative on the offensive end.

Democratic lawmaker criticizes party brand, Pelosi
But Pelosi continues to command great loyalty from many in the House, and she insisted her position was not in jeopardy. There are, though, reasons to believe Pelosi poses a unique political problem for Democrats.

Special election losses leave Democrats divided, searching
Moreover, the race garnered the attention of the entire nation, including the likes of President Donald Trump . " Karen Handel won in a Republican district that was drawn for a Republican to win", Johnson told Elliot.

What's Next on Health Care Draft in Congress
McCain said he's closely reviewing the draft legislation released Thursday and will be speaking with Republican Arizona Gov. "This bill will have devastating consequences for hard working families, the elderly and the sick", Ryan said .

© 2015 Stump Report. All Rights reserved.