China stocks reverse losses as investors shrug off MSCI "nay" decision
SHANGHAI, June 15 (Reuters) - China stocks reversed early losses and rose more than 1 percent by midday on Wednesday as investors quickly shrugged off MSCI's decision not to add mainland Chinese shares to one of its key benchmark indexes.
Traders said Chinese investors had already been bracing for a "no" decision, as reflected by Monday's market tumble of more than 3 percent.
Index provider MSCI Inc said on Tuesday that Beijing had more work to do in liberalising its capital markets before it could add Chinese A shares to its emerging markets index, which is tracked by $1.5 trillion of managed assets.
With the MSCI decision now in the rear mirror, investors are focusing again on China's struggling economy and the potential fallout for global growth and financial markets if Britain votes to leave the European Union next week. Europe is one of China's biggest export markets.
The blue-chip CSI300 index jumped 1.4 percent, to 3,119.76 points by lunch time, while the Shanghai Composite Index gained 1.5 percent, to 2,885.78 points. They had opened roughly 1 percent lower as some investors who had clung on to hopes of MSCI inclusion unwound their bets.
Shenzhen's start-up board surged nearly 4 percent.
In Hong Kong, both the Hang Seng index and the Hong Kong China Enterprises Index added 0.5 percent. The MSCI emerging index already includes some Chinese H shares listed in Hong Kong.
The MSCI decision comes a year after China's stock markets went into near-meltdown after a speculative rally burst. Main indexes plunged some 30 percent in a month, wiping out nearly $4 trillion in market value at one point and triggering a massive and unprecedented government rescue that has yet to be unwound.
Chinese markets have attempted a few rallies since then, but overall levels are still not much above their mid-2015 lows and weak trading volume highlights continued investor pessimism. Continuación...