Beijing time2month10International Indexes CommitteeMSCIThe quarterly audit change results were announced. Among them,MSCIChina Indexes Newly Included12Only Chinese stocks, excluding6only;MSCIAThe onshore equity index has increased.10Only constituent stocks, excluding5Only constituent stocks, the above adjustment results will be in2month28Effective from today.
How do you view the newly included sectors such as biomedicine and new energy industries, which involve companies listed on the stock market? Why are they included?2023Is there a significant increase in foreign investment interest in Chinese assets over the past year? Is it expected that the attractiveness of Chinese assets will further enhance in the future? Frost & SullivanFrost & SullivanDr. Wang Xin, Global Partner and President of Greater China at Frost & Sullivan (hereinafter referred to as 'Frost & Sullivan'), was interviewed by Securities Daily Interview, to jointly discuss the aforementioned topics.
Securities Daily
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Securities Daily Reporter: How do you view the new sectors included in the stock index, such as biomedicine and new energy industries, involving companies?
MSCIThe design of the China Foreign Direct Investment Index aims to represent a list of Chinese enterprises available for foreign investors to invest in. The composition of this list can, to a certain extent, reflect the investment preferences of overseas institutional investors and their expectations for the development of the domestic macro market. In fact, if we start from some important variables that have occurred in the macro market in recent years, this timeMSCIThe fact that the new target industries involve biomedicine and new energy enterprises is actually an expected outcome.
From the perspective of international markets, In recent years, the pharmaceutical and new energy sectors have always been highly favored for investment, especially due to2022With the recurring COVID-19 pandemic and the impact of events such as the shortage of fossil energy in Europe due to the Russia-Ukraine war, international capital markets have shown a significant increase in their attention to the pharmaceutical and new energy sectors.MSCIThe selection of investment targets by indicators is naturally affected to a certain extent by the hotspots in international capital markets.
From the perspective of domestic macro policies, Biomedicine and new energy industries, as important components of China's 'new economy,' align closely with the current national strategic direction. With national strategies such as industrial upgrading, livelihood project construction, and sustainable development deeply rooted in people's hearts, long-term support from macro policies for the biomedicine and new energy industries is foreseeable. A long-term and sustained favorable policy environment is an important guarantee for attracting foreign capital during the industry development process.
From the perspective of domestic social development, The enhanced awareness of residents' medical security after the COVID-19 pandemic has provided a strong driving force for future growth in China's biopharmaceutical market. The aging consumer structure has brought opportunities for the rapid development of domestic community health care industries. On the other hand, with the gradual increase in the penetration rate of new energy vehicles in China, the successful attempts of the automotive industry in the new energy market have raised the overall market's confidence and enthusiasm for the application of new energy technologies. The investment opportunities in new energy-related fields such as energy production, energy transmission, energy storage, and other areas are increasingly attractive to overseas investors.
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Reporter of Securities Daily: Why enter2023Has foreign investment's interest in Chinese assets increased significantly in recent years? Is it expected that the attractiveness of Chinese assets will further enhance in the future?
Firstly, as one of the world's most important economies, China's macroeconomy maintained positive growth during the pandemic, which undoubtedly demonstrated the high stability of the Chinese market to global investors once again. This is very rare in the current overall downward global economic environment. Therefore, overseas institutional investors currently maintain a strong interest in allocating Chinese assets as hedging assets. On the other hand, the lifting of lockdowns did not lead to domestic industrial turmoil, and China's economy has begun to recover strongly in the short term.2023The overall market trend for the year is widely viewed as positive by global investors,2023An important reason for the increase in foreign investment in the year.
In the long run, as the Chinese economy steadily takes off, the attractiveness of the Chinese market to foreign capital will surely become stronger. Especially with the advantages of a large investment market scale in China, the dual-track system, and the high proportion of the 'new economy', the Chinese market will always remain a hot destination for overseas investors.
*This interview was published in 'Securities Daily', with reporters Du Yumeng and Mao Yirong. The original title was "The MSCIChina Index Quarterly Adjustment 'New Entrants' Several foreign investors have expressed optimism about Chinese assets >> (Click on "Read the Original Article" at the end of the text to read the full report).
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