Foreign investors eye China's stock market ahead of MSCI inclusion

Updated 2018-03-20 16:28:01 Xinhua

Overseas institutional investors have been increasing their holdings of Chinese stocks ahead of the inclusion of A-shares by global index provider MSCI.

Foreign institutions were among the top ten investors in tradable shares of 29 stocks on the A-share market by the end of last year, according to data provider

The institutions, which invested via the Qualified Foreign Institutional Investor (QFII) program, overweighed small and medium-cap shares and shares with relatively low price-to-earnings (P/E) ratios.

Of the 29 stocks, 16 companies have market capitalization below 10 billion yuan (1.58 billion U.S. dollars).

The P/E ratio of six companies favored by the foreign investors stood below 20, representing relatively low valuation.

Hunan Valin Steel Company, a steel maker that saw increased QFII holdings, has a P/E ratio of about 6.

The company saw its earnings per share surge last year thanks to rising demand as a result of cutting excess capacity, according to its annual report.

In terms of industries, QFII investors are bullish on the medical sector. Four companies in the industry saw QFII among their top ten investors.

The bullish sentiment came ahead of the widely expected inclusion of the A-shares by global index provider MSCI starting in June.

MSCI announced last year that it would partially include some large-cap A-shares in the MSCI Emerging Markets Index, a move that analysts said could bring large inflows of foreign funds to boost the value of A-shares.

MSCI announced last week the launch of 12 new indexes that will expand its China index offering, including the MSCI China A Index, MSCI China A RMB Index, and MSCI China All Shares Large Cap Index.

Also in the News

Nicole Kidman Recalls Oscar Glory: Loneliest Time
Showbiz2016/06/16 13:58December 19 2018 02:06:50

Nicole Kidman Recalls Oscar Glory: Loneliest Time

Attending Shanghai International Film Festival, Nicole Kidman talks about her role in "Grace of Monaco".

Labor Day Travel Peak Starts
Also in the News2014/05/01 12:16December 19 2018 02:06:50

Labor Day Travel Peak Starts

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'
Also in the News2014/04/18 13:18December 19 2018 02:06:50

Johnny Depp Delivers a Speech 'Evolve the Future' in 'Transcendence'

Hollywood star Johnny Depp's speech in the upcoming new film "Transcendence" has been disclosed on Friday, April 11th.

China World Business Sports Showbiz Audio
C4 My Chinese Life The Sound Stage China Revealed Showbiz Video Travel Video
China World Fun Travel Entertainment Sports
Beijing Shanghai Guangzhou
Live Music Opera & Classical Movies Traditional Shows Exhibitions
Learn Chinese:
Chinese Studio Living Chinese Everyday Chinese Just For Fun Chinese Culture Buzzwords