Chinese service providers
For the USA it has been an eventful week domestically, but the vector of foreign trade policy has not changed. The New York Stock Exchange (NYSE) still decided to stop trading in the securities of three Chinese telecom operators, they will also be excluded from the stock indices and rumours are already mentioning Alibaba and Tencent shares in a similar context.
The administration of the New York Stock Exchange said that it was returning to its original plan of action regarding the depositary receipts of Chinese telecoms operators China Mobile, China Telecom and China Unicom. They are suspected by US authorities of having links to the Chinese defence sector and therefore investors in the US are instructed not to fund their activities through the purchase of depositary receipts. Reuters claims that the exchange management was forced to change its decision under pressure from US Treasury Secretary Steven Mnuchin.
The S&P and Dow Jones stock indices will synchronously remove the depositary receipts of the three Chinese companies on the New York floor on the morning of 11 January. Also, the Trump administration expects to add Alibaba and Tencent, two other Chinese companies whose operations may be directly controlled by Chinese authorities, to the blacklist, according to the initiative. The news caused both companies share prices to drop by between 3 and 5 per cent.