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MSCI announced today (11) the weighting adjustment. The top three weights for Taiwan stocks have been lowered. Among them, the MSCI Global Emerging Markets Index has fallen 7 times in a row and the latest weights will take effect at the close of 11/30.
The weight of the “MSCI Global Emerging Markets Index” decreased from 12.80% to 12.47%, a decrease of 0.33 percentage points, and the weight of the “MSCI Asia Ex Japan Index” decreased from 14.22% at 13.95%, a reduction of 0.27 percentage points. The weight of the “Global Market Index” has been reduced from 1.62% to 1.61%, a decrease of 0.01%. As for the “MSCI Global Emerging Markets Index”, Taiwan shares have declined in the last seven consecutive MSCI adjustments.
As for the constituent stocks of the MSCI Taiwan index, this time 2 new constituent stocks were added, namely Xinxing and Heyi, and the 2 constituent stocks were removed as Fortune and Evergreen. The constituent shares of the index will remain at 87 constituent shares and 13 constituent shares have been adjusted. Regarding the number of shares outstanding, the biggest increase in weight this time is the new value of Xinxing, with a weight change of 0.42%. The component of securities with the greatest weight reduction is TSMC, with a weight change of -0.23%.
In this quarterly adjustment of the MSCI, according to the “MSCI Global Emerging Markets Index”, the country with the highest weight gain is India, with a weight gain of 0.81%; and the country with the greatest weight reduction this time is Taiwan. Weight is reduced by 0.33%. However, after this adjustment, Taiwan remains the second most weighted country in the index, after China.
Although the top three weights of Taiwan shares have been lowered, the investment and credit legal entity cited the fundamental advantages of Taiwan. He said that in the second half of 2020, the economies of several countries will begin to recover from the impact of the new corona pneumonia epidemic. According to statistics from the National Development Council, the signal of economic measures in September has given the green light for the second consecutive moon. The economy is advancing and the indicators continue to rise. According to data released by the Accounting Office of the Chief Executive Yuan in October, Taiwan’s economic growth in the third quarter The rate was better than originally expected and was revised to 3.33%, showing that Taiwan’s economy is has gradually recovered and stabilized. Additionally, Taiwan has benefited from the continued fermentation of 5G communications and long-distance business opportunities, as well as the effect of the transfer order due to the epidemic and trade wars. This has allowed domestic exports to perform very well in recent months, and the amount of money has set a record.
Regarding the international situation, the current focus is on the follow-up impact of the US presidential elections. Biden will be elected president of the United States without surprises. However, Trump has not yet relented and intends to wage a lengthy legal battle. The epidemic stimulus bill that has caught the attention of the market General may suspend it first, and Biden will face the situation where the Senate and House of Representatives are divided between the two main political parties after taking office. It will be more difficult to promote large-scale fiscal policies. This can lead to downside market risks. However, the Federal Reserve Committee after the FOMC meeting in November, decided that monetary policy will remain unchanged and said that if necessary, it will increase loose monetary policy. Other central banks also maintain loose monetary policies and global funds are plentiful, which is really good for emerging markets.
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