MSCI will begin to add overseas-listed Chinese shares to its emerging market indexes this month, drawing billions of dollars into such stocks, which could eventually lead to mainland-listed companies finding their way into global equity portfolios.
The index provider’s decision in June not to include domestically listed China stocks, known as A-shares, in its global indexes, which are tracked by equity funds holding trillions of dollars, contributed to a sharp sell-off, prompting Chinese authorities to launch a heavy-handed rescue operation.
The inclusion of overseas-listed China shares, known as American Depositary Receipts (ADR), will be the first test of foreign demand for greater exposure to China since its markets returned to an even keel after a stormy summer.
