Major indexes set to include STAR stocks

A number of stocks listed on the SSE STAR Market will be included in the major indexes for A-shares from December 14.

In response to the securities market development, and after listening to market opinion and deliberations by the Index Advisory Committee, the Shanghai Stock Exchange and China Securities Index Co have decided to include SSE STAR securities which have been listed for more than a year into some component indexes such as the SSE 180 Index and CSI 300 Index, it was announced on Friday.

This rule adjustment will be implemented in the next index periodical review on December 14.

The SSE STAR Market, which has been operating smoothly for more than a year, has become an important part of China’s capital market, where companies with different voting right structures, unprofitable companies and depository receipts issued by red-chip enterprises have the opportunity to go public, the exchange said.

Meanwhile, the STAR 50 Index has been running smoothly for more than a quarter and is widely recognized by the market, the exchange noted. “Aiming to further enhance the influence of the STAR Market, introduce more medium and long-term funds, and provide investment channels for small and medium-sized investors, the inclusion of STAR shares into the component indexes is imperative.”

Also on November 27, the stock exchanges of Shanghai, Shenzhen and Hong Kong reached an agreement on an expansion to the existing Stock Connect inclusion arrangements.

The three exchanges have agreed that STAR Market-listed shares that are constituent stocks of the SSE 180 Index and SSE 380 Index, or have H-share counterparts listed in Hong Kong, will be eligible for trading under the Shanghai-Hong Kong Stock Connect program, while the corresponding H-shares will be included in the Stock Connect schemes linking Shanghai and Shenzhen with Hong Kong.

The inclusion is expected to take place early next year.