The MSCI China Index rebalancing results announced earlier by global index provider MSCI Inc will take effect after market close on November 24, 2025. Among MSCI's index series covering Chinese equities, the MSCI China Index is particularly noteworthy as it's nested within the MSCI Emerging Markets Index, meaning inclusion brings passive fund tracking from the global standard index series.
This adjustment adds 26 constituents, including resource stocks and technology companies in semiconductors and advanced manufacturing. Nine Hong Kong-listed stocks were added: ZIJIN GOLD INTL (02259), GF Securities (01776), Ganfeng Lithium (01772), CHINFMINING (01258), China Gold International (02099), RemeGen (09995), DONGFENG GROUP (00489), Ubtech Robotics (09880), and XtalPi (02228), along with 17 A-shares. Meanwhile, 20 Chinese stocks were removed, including four Hong Kong listings: Beijing Enterprises Water (00371), China Everbright Bank (06818), China Resources Pharmaceutical (03320), and TravelSky Technology (00696), plus 16 A-shares.
Historical patterns show passive funds typically rebalance on the effective date to minimize tracking error, often causing unusual trading volume spikes in affected stocks during late sessions. Some arbitrage capital may position ahead based on unexpected results, though newly added stocks sometimes decline on implementation day, especially less liquid names.
Foreign institutions are increasingly bullish on Chinese assets. UBS's 2026 outlook projects the MSCI China Index reaching 100 points (14% upside) and the Hang Seng Index at 30,000 (12.9% upside), citing sustained positive factors. Morgan Stanley forecasts moderate 2026 gains, with Hang Seng and CSI 300 targets at 27,500 (+6%) and 4,840 (+5.9%) respectively, anticipating 6% earnings growth for Chinese firms.
13F filings reveal Wall Street institutions boosted Chinese asset allocations in Q3, particularly in tech via ETFs like KWEB. Key stocks: - ZIJIN GOLD INTL (02259): Morgan Stanley initiated at "Overweight" with HK$175 target, citing low-cost operations and gold price upside. - GF Securities (01776): Goldman Sachs raised estimates after strong Q3 but maintains "Neutral," target up to HK$16.36. - CHINFMINING (01258): Guosen Securities maintains "Outperform" on copper expansion prospects. - DONGFENG GROUP (00489): Morgan Stanley raised target 5.6% to HK$11.24 after Voyah brand's price/sales growth.
Other developments include Ubtech Robotics' (09880) AI humanoid robot commercialization and XtalPi's (02228) FDA-cleared cosmetic ingredients developed via AI platform.