A healthy bourse needed to drive long-term growth

China Daily (Canada) - - LIFE -

For Chi­nese in­vestors who have been ex­pect­ing in­tro­duc­tion of more in­ter­na­tional in­sti­tu­tional in­vestors to boost the do­mes­tic stock mar­ket, it is dis­ap­point­ing thatMor­gan Stan­ley Cap­i­tal In­ter­na­tional has again de­layed adding Chi­nese shares to its bench­mark emerg­ing mar­kets in­dex.

Oneyear af­ter last­sum­mer’s stock crash, Chi­nese shares are still strug­gling to­have a solid foothold. But the poor per­for­mance of theChi­nese stock­mar­ket should not be­made anex­cuse to­deny its long-term sig­nif­i­cance to both theChi­ne­seecon­o­myand­in­vestors at home­andabroad.

In­ret­ro­spect, it seems wise forMor­gan Stan­ley to­have de­ferred in­clu­sion ofChi­nese A-shares in one of itskey in­dices last June­just as thebench­markShang­hai Com­pos­ite In­dex peaked at 5,178.19. Withthe Shang­hai in­dex still strug­gling be­low 3,000nowa­days, an­ear­lyMor­gan Stan­leyn­od­would­have­donelit­tle toChina’s in­te­gra­tion into the glob­al­mar­ket by pre­ma­turely ex­pos­ing global in­vestors to the tu­mult ofChina’s stock­mar­ket.

Yet a move to make Chi­nese stocks a big­ger part of the global port­fo­lio is in­evitable.

Newspapers in English

Newspapers from China

© PressReader. All rights reserved.