Chinese Stocks Rejected for MSCI Index Inclusion

(Beijing) – Domestically listed Chinese stocks failed to make the grade for inclusion in a key emerging markets stock tracker after their third attempt in three years, as index complier Morgan Stanley Capital International (MSCI) said more time was needed to see if recent reforms to China's market will be effective.

The decision marked a major disappointment for Chinese regulators and stock market boosters, who have been lobbying heavily for the MSCI's inclusion of local stocks, known as A-shares. Such inclusion would not only add greater credibility to China's stock markets, but could facilitate the inflow of billions of dollars in offshore funds that make their investments based on MSCI's indexes.