China stocks open sharply lower after MSCI declines China inclusion
SHANGHAI (Reuters) – China stocks opened roughly 1 percent lower on Wednesday after MSCI declined to add domestic Chinese stocks to one of its key indexes, prompting a sell-off in blue-chip shares as disillusioned investors unwound their bets.
With the MSCI decision dashing hopes of steady foreign capital inflows, investors are now focusing on China’s struggling economy amid a spike in global market volatility on worries Britain would vote to leave the European Union next week.
The CSI300 index fell 1.0 percent to 3,043.96 points at 1:29 GMT, while the Shanghai Composite Index lost 1.0 percent to 2,814.69 points.
The Hang Seng index in Hong Kong was down 1.1 percent.
Despite the early negative reaction, some analysts say the MSCI decision has limited impact on China’s onshore stock market.
“China’s equity market is very domestic. Cross-border flows are expected to have little impact on the domestic market in the near term,” ANZ said in a note after the MSCI decision.
(Samuel Shen and Nathaniel Taplin; Editing by Sam Holmes & Shri Navaratnam)