Why China's First Steps Into MSCI Are Such a Big Deal

More than 200 of China’s large-cap domestic stocks are getting a significant new inflow of investment. They are among the companies that MSCI Inc., the New York-based provider of financial tools, has added to its major emerging-market indexes from today. The inclusion of these so-called A shares -- stocks that historically were available only to Chinese investors -- is a stamp of financial credibility that will open China to more global investment. MSCI had long rejected the inclusion of Chinese A shares until finally approving them last year.

Heavyweights including Kweichow Moutai Co., China’s biggest liquor maker, and surveillance camera maker Hangzhou Hikvision Digital Technology Co., were added to the Emerging Markets Index, MSCI China Index and the MSCI All Country World Index. They’ve been among foreigners’ favorite purchases through the Hong Kong-mainland stock links and have surged more than 55 percent over the past year. Other companies include SAIC Motor Corp., Midea Group Co. and Gree Electric Appliances Inc.