Bei Ke Cai Jing·2025-09-04 07:20Core Viewpoint - The recent quarterly review by FTSE Russell on multiple indices involving China indicates a significant shift in fund flows, particularly favoring high-growth sectors such as innovative pharmaceuticals and AI computing power, while traditional sectors like utilities and telecommunications are being sidelined [1][12]. Group 1: Index Changes - The FTSE China A50 Index has added companies such as BeiGene, NewEase, WuXi AppTec, and Zhongji Xuchuang, while removing China Nuclear Power, China Unicom, Guodian NARI, and Wanhua Chemical [3][4]. - Newly included companies have market capitalizations exceeding 280 billion yuan, reflecting a preference for high-quality large-cap growth stocks [3]. - The passive funds tracking the FTSE China A50 Index exceed 10 billion USD, indicating that changes in index composition can lead to significant capital flows, potentially in the hundreds of millions or even billions [1]. Group 2: Market Performance - The newly added stocks have shown remarkable performance, with all four companies experiencing over 100% growth this year, and the highest growth reaching 350% [4]. - The market is currently favoring technology growth sectors, as evidenced by the inclusion of companies from the optical module sector and innovative pharmaceuticals [11][12]. Group 3: Industry Trends - The adjustments in the index reflect a broader trend of market funds embracing technology growth sectors while showing a decline in preference for cyclical sectors [12]. - The demand for high-speed optical modules has surged due to advancements in AI technology and increased computing power needs, benefiting companies like Zhongji Xuchuang and NewEase [13]. - The innovative pharmaceutical industry is gaining competitiveness in both domestic and international markets, supported by increased policy backing and enhanced R&D capabilities among domestic firms [14][15].