(Yicai Global) Nov. 4 -- China's A-share market has suffered big shocks in recent months, and the Shanghai Stock Exchange and China Securities Index will adjust the sample stocks of multiple indices accordingly, the two said in statements yesterday.
SSE and CSI will remove several security brokerages from their indices as their sectors' stock prices have fallen and share values plummeted. The two will replace them with pharmaceutical shares which attract investment funds.
The SSE and CSI will adjust the index stocks of the SSE 50, SSE 180, SSE 380 and SSE dividends on Dec. 17, per the statements.
Five stocks in the SSE50 will drop out, including China Northern Rare Earth Group High-Tech [SHA:600111], Orient Securities [SHA:600958], China Merchants Securities [SHA:600999], Zheshang Securities [SHA:601878], and China Galaxy Securities [SHA:601881]. Four are in the brokerage sector.
China Galaxy Securities and China Merchants Securities both fell more than 50 percent this year, while Orient Securities shed more than 30 percent.
Haitong Securities [SHA:600837] also dropped out of the SSE 50 Index in an adjustment in May.
Pharmaceutical stocks are emerging as new members of the SSE 50 Index, among them Fosun Pharma [SHA:600196] and WuXi AppTec [SHA:603259]. The other three new members of the SSE50 Index are Foxconn Industrial Internet [SHA:601138], China International Travel Service [SHA:601888] and China Construction Bank [SHA:601939].
The SSE 50 Index consists of 50 sample stocks with a large scale and good liquidity. It reflects the comprehensive status of major players with excellent performance and profound influence with the exchange. The two bourses will adjust samples based on market conditions. This is also the second adjustment this year.
SSE 180, SSE 380 and SSE dividends will also change their sample stocks. The SSE 180 Index will replace 18 stocks, including Shanghai Electric Power [SHA: 600021], Tsinghua Tongfang [SHA:600100], Polaris Bay Group [SHA:600155] and Nanshan Aluminum [SHA:600219].
Editor: Ben Armour