China’s attraction to foreign investment is growing day by day.
On the morning of February 10, Beijing time, MSCI, a world-renowned index company, announced the results of quarterly audit changes. In this adjustment, MSCI China Index added 10 Chinese stocks and eliminated 4. Most of the new targets are blue chip white horse stocks in the fields of science and technology, energy, infrastructure and so on. Among them, the most striking are the return of white horse stocks Gree Electric Appliances Inc.Of Zhuhai(000651) with a market value of 100 billion yuan and the new inclusion of China Mobile, a giant with a market value of trillion yuan.
The adjustment of MSCI China Index often attracts a large number of overseas passive funds. The author believes that the adjustment of MSCI constituent stocks reveals the idea of foreign capital long A-Shares and continues to be optimistic about China’s economy.
In recent years, steady growth policy has continued to make efforts, infrastructure construction has become an important starting point for steady growth, and scientific and technological innovation has also been highly praised by all parties as the key direction to help steady growth. in this context, foreign capital is overweight to allocate high-quality core assets that are expected to benefit from the A-share market.
Since the beginning of this year, the overseas market has fluctuated sharply, and RMB assets have become an important option for global investors to diversify risks, which are sought after by foreign investors.
At present, China’s steady growth direction is clear, policies continue to be strengthened, and macro liquidity is loose, which makes China’s capital market full of toughness and security “unique” in global fluctuations.
According to the latest economic data , China’s gross domestic product (GDP) exceeded 110 trillion yuan in 2021, with a year-on-year increase of 8.1%, accounting for more than 18% of the global economy, making a great contribution to driving world economic growth, and maintaining a global leading position in economic development and epidemic prevention and control. This will further promote the allocation of Chinese assets by foreign capital.
Following the record high net purchase of more than 430 billion yuan in 2021, as of February 10 this year, northbound funds have accelerated the purchase of a shares, with a cumulative net purchase of 26.513 billion yuan.
At the same time, the scale of Chinese bonds held by foreign investors also hit a record high. According to the data, by the end of December 2021, the total amount of Chinese bonds entrusted by foreign investors had exceeded 4 trillion yuan. Including QFII, land stock connect and beixiangtong, the amount of Chinese assets held by foreign capital exceeds 7 trillion yuan.
According to the latest data from the Ministry of Commerce, in 2021, China’s actual use of foreign capital was 1149.36 billion yuan, a year-on-year increase of 14.9%, and the scale of attracting foreign capital reached a new record. This is also the first time that China has broken the trillion yuan mark in absorbing and utilizing foreign capital.
“Foreign investment embracing Chinese assets” has become the consensus of many institutions. Recently, well-known investment banks and Chinese research institutions have shouted “at present, there is a rare opportunity to invest in Chinese assets, which can be over allocated with a shares.”
Indeed, due to the proper prevention and control of the epidemic in China and the good economic prospects, Chinese assets are being favored by foreign capital, and the unique independence and valuation advantages of A-Shares are gradually emerging, which makes the long-term inflow trend of foreign capital unchanged.
