When Chinese stocks won admission to MSCI’s indices last week, Australia was not the first market many people looked to — but it is arguably one of the most affected. That is because in the broader Asia-Pacific region, where investors typically put Tokyo in a category all of its own, wins for Shanghai and Shenzhen will come at the expense of Sydney — already the region’s worst performer this year.

The geographic centre of Asian market capitalisation, excluding Japan, has been shifting northward for decades. From a point just east of Darwin in 1975, as calculated by Credit Suisse, the midpoint is currently over the South China Sea and should reach Hong Kong by 2030 as mainland markets increase their share of regional benchmarks. By that point, Australia’s weighting in those same indices will have halved to 6 per cent, reckon the bank’s analysts.

That long-term gloom is not the reason for this year’s underperformance. The ASX 200 has added just 1 per cent compared with gains of 17 per cent or more for Hong Kong, Seoul and Mumbai. Aussie business optimism is strong but consumer activity is not. Growth of 1.7 per cent is the country’s slowest since the aftermath of the global financial crisis, and earnings downgrades have begun once more to outnumber upwards revisions just as profits elsewhere in the region are picking up noticeably. Earnings are forecast to rise about 11 per cent in Australia this year — but 19 per cent in the region as a whole.