The Trump administration and members of Congress put pressure on the New York Stock Exchange on Tuesday to remove China’s three major state-owned telecommunications companies from the stock market.
The stock exchange late Monday reversed its original plans, announced last week, to delist the companies to comply with a government executive order to halt US investment in companies linked to the Chinese military. .
Monday’s sudden turnaround by the exchange sowed confusion and reflected the ongoing battles within the Trump administration over how difficult it should be to think against China during President Trump’s last term. Treasury Secretary Steven Mnuchin has called for greater accommodation for Chinese companies, while Defense Department officials have argued that the companies involved should be removed for national security reasons.
The Big Board said late Monday that plans to delist the companies had been halted after consultation with the Treasury Department. A week after the stock market said it would stop trading shares in China Unicom, China Telecom and China Mobile by Jan. 11 in response to an executive order from the Trump administration that barred Americans from investing in companies that the Chinese are linked. military.
The speculation that the reversal by Mr. Mnuchin eased, brought a setback of some Chinese hawks in Congress on Tuesday.
“The days of Wall Street and China benefiting American workers and industry must end,” said Senator Marco Rubio, a Republican from Florida. said on Twitter. He said such a move would be an ‘outrageous attempt’ to undermine President Trump’s executive order.
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The Department of Defense also overturned the decision by issuing a statement to Bloomberg News on Tuesday stating that keeping the companies on the stock exchange strengthens them and ‘promotes intelligence-gathering activities’ by the Communist Party of China. Shortly after the statement was announced, however, the Pentagon withdrew it. A Pentagon spokesman declined to comment.
The department of treasury did not comment on whether Mr. Mnuchin urged the stock market to stop delisting. On Tuesday, while embarking on an international trip, Mnuchin wanted the exchange to go ahead with its plan to remove the companies. . A senior official said Mr. Mnuchin on Tuesday called Stacey Cunningham, president of the NYSE group, to object to the decision not to delist.
A New York Stock Exchange spokeswoman did not comment on the call.
The scope of the president’s executive order is the subject of debate. According to a person familiar with the matter, the stock exchange withdrew its plan to delist the Chinese companies after determining that the language was ambiguous and that it was unclear whether the companies should be removed.
If the Department of Treasury explains that the order applies to those companies, the exchange will continue with the delisting, this person said.
Another administration official said talks were underway on Tuesday night to update the order to make it clear that it applies to Chinese telecommunications companies.
The stock exchange’s statement Monday gives no reason for the decision, although it refers to the ambiguity of the order and says the move comes “in light of further consultation with the relevant regulatory authorities.” The exchange says the regulatory division will continue to evaluate the applicability of the order to the telecommunications companies.
The delisting would have had little practical impact on the companies, which also listed shares in Hong Kong and are state-owned. Yet the disappearance from the US stock market had great symbolic value for the deteriorating economic ties between China and the United States.