Most U.S. hedge funds aren't expecting another big stock market sell-off as more firms curb bets on volatility, according to Nomura.Marketsread more
More tit-for-tat tariffs in the U.S.-China trade war could set the global economy up for a recession, according to Morgan Stanley.Marketsread more
A sell-off in chip stocks intensified following a report that chipmakers are cutting ties with Huawei after the Trump administration's ban.Marketsread more
A series of tweets Monday marked the latest chapter in Trump's decadeslong effort to refute published reports that his previous financial problems have rendered him an...Politicsread more
President Trump stands a chance of creating a new economic world order in his China trade fight, says the chief economic advisor of Allianz.Economyread more
Sens. Mitch McConnell and Tim Kaine plan to introduce a bill Monday that would raise the minimum age to buy tobacco to 21 in hopes of curbing what regulators are calling an...Health and Scienceread more
Ford Motor said Monday that it is laying off about 7,000 salaried workers, about 10% of that global workforce, as part of a restructuring plan designed to save the No. 2...Autosread more
Silicon Valley argues that the public market investors focus too much on near-term profits — but investors have embraced money-losing biotech IPOs.Marketsread more
Despite high criticism from fans, the final episode of "Game of Thrones" shattered single-night viewing records Sunday, with 19.3 million tuning in to watch the finale.Entertainmentread more
Restaurants are thinking outside the box to attract and retain talent. A report from TDn2K, a restaurant analytics firm, finds that employee vacancies are a major concern for...Restaurantsread more
Forty percent of customers will choose a center to shop at based solely on the food that's there, JLL found in a new study. And nearly 38% of people want healthy options when...Retailread more
Major stock index firm MSCI said Tuesday it would delay inclusion of the mainland-traded Chinese A shares in its key emerging market index given lingering concerns about market accessibility.
"This could be a good thing, because it gives China incentive to push reforms through further rather than give them the benefit of the doubt," said Lucy Qiu, emerging market strategist at UBS Wealth Management.
Among issues that must be addressed, MSCI said in a release the 20 percent monthly repatriation limit remained a "significant hurdle" for investors.
"Chinese authorities have been trying to attract capital in, but restricting outflows, and this (repatriation limit) is capital restriction out. That does deter a lot of foreign investors," Qiu said, noting that "if the global environment remains benign and the currency depreciation remains gradual, they could actually consider relaxing it."
MSCI said it would retain the China A shares inclusion proposal as part of the 2017 review and did not rule out a potential off-cycle announcement "should further significant positive developments occur ahead of June 2017."
"International institutional investors clearly indicated that they would like to see further improvements in the accessibility of the China A shares market before its inclusion in the MSCI Emerging Markets Index," Remy Briand, managing director and global head of research at MSCI, said in the release. "In keeping with its standard practice, MSCI will monitor the implementation of the recently announced policy changes and will seek feedback from market participants."
The release also said investors needed more time to assess the effectiveness of the Qualified Foreign Institutional Investor program (QFII) investment quota allocation, capital mobility policy changes and the effectiveness of the new trading suspension policies.
"It appears the changes, while they have occurred, are too recent," said Chris Johnson, vice president of ETF sales and strategy at Macquarie in New York.
Last year, MSCI rejected the Chinese shares given concerns about market accessibility, liquidity and share ownership. The mainland Chinese stocks have had high volatility since then, including stock suspensions last summer and a circuit breaker fiasco in January. The Shanghai composite is down more than 40 percent over the last 12 months.
Chinese regulators in the last few months stepped up efforts to address many of those concerns, including a late May announcement by the Shanghai and Shenzhen stock exchanges of revised rules to limit stock suspensions. Analysts from firms such as Goldman Sachs recently increased their expectations that MSCI would have a favorable decision Tuesday.
MSCI did note Tuesday Chinese authorities have made "significant improvements" in accessibility for global investors.
"It's basically painted a fairly positive picture on the Chinese market, but it's not quite there for broad foreign investment," Johnson said.
The Deutsche X-trackers Harvest CSI 300 China A-Shares ETF (ASHR) traded more than 2 percent lower in after-hours trade. The iShares MSCI Emerging Markets ETF (EEM) was unchanged.