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Sat, December 12, 2020 – 11:56 a.m.
The securities, which are not listed on the Nasdaq exchange, will be delisted from the indices on December 21. They include China Communications Construction, China Railway Construction Corp, CRRC Corp and Semiconductor Manufacturing International Corp, Nasdaq said in a statement.
Last month, an executive order from the White House barred US investors from buying securities of blacklisted companies, beginning in November 2021. The administration of President Donald Trump alleged that the companies were linked to the Chinese military.
China condemned the move, saying the effort went against the principles of competition in the market. “The United States must stop abusing national power and national security concepts to repress foreign companies,” Foreign Ministry spokeswoman Hua Chunying said on December 4.
A spokeswoman for index provider MSCI Inc said by email on Friday that the firm has spoken with clients about possible changes and will communicate “any necessary changes” soon.
The FTSE Russell Index said on December 4 that it would delist the shares of eight Chinese companies in light of the White House measures.
S&P Dow Jones Indices said on December 10 that it would remove A-shares listed in mainland China, H-shares listed in Hong Kong, and US certificates of deposit (ADRs) of 10 companies, including Hangzhou Hikvision Digital Technology, from all indexes of shares before the market opens December 21.
The steps of the index providers show the practical impact of the US order. US investors often maintain their exposure to Chinese equities in passive broad index-based products.
The four Chinese companies removed by Nasdaq are the only ones on the White House list to appear on the Nasdaq indices, a spokeswoman said. Nasdaq leaders were not immediately available for further comment.
REUTERS
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