JPMorgan, Morgan Stanley and Goldman Sachs will delist 500 structured products listed on the Hong Kong Stock Exchange as the effects of President Donald Trump’s executive order are barred from increasing investments in companies with alleged links to China’s military organizations.
During his last days in office, Trump tried to cage Beijing before the inauguration of Democratic President-elect Joe Biden later this month.
In addition to buying shares of dozens of Chinese companies believed to be linked to the People’s Liberation Army, the outgoing president has also moved to restrict transactions with Chinese payment applications, including Alipay, WeChat Pay and Tencent’s QQ Wallet.
The move by JPMorgan, Morgan Stanley and Goldman Sachs follows a decision by MSCI on Friday to abandon Chinese state-owned telecommunications companies China Mobile, China Telecom and China Unicom from their strict stock standards in order to penalize potential legal penalties arising from the executive. avoid. order, which takes effect on 11 January.
Hong Kong Exchanges and Clearing said the decision to delist 500 structured products was a ‘direct result’ of US sanctions, adding that it would continue to monitor developments.
“HKEX is working closely with the issuers concerned to ensure that the listing is delisted directly, and to arrange repurchase arrangements arranged by the issuers,” Sunday said. “We do not believe this will have a material adverse effect on the Hong Kong Structured Products Market, the largest in the world with more than 12,000 listed products.”
On Monday, the manager of the Hong Kong Tracker Fund, the city’s largest exchange-traded fund by assets, announced that it would not make new investments in a US sanction.
State Street Global Advisors said it was ‘no longer appropriate for US people’ to invest in the tracker fund, which closely follows Hong Kong’s Hang Sang Index.
The fund owns shares in the Hong Kong listing of China Mobile and China Unicom, which are among the sanctioned companies on the US blacklist.
Last week, the New York Stock Exchange confirmed that the two companies, along with China Telecom, would be removed due to the sanctions.
The Hang Seng index rose 0.8 percent in morning trading.
In its efforts to avoid violating the same regulations, the New York Stock Exchange has become embroiled in controversy. They first listed the three Chinese telecommunications instruments and then reversed the course before deciding to proceed last week at the insistence of the department of treasury.
Lawyers and financial executives have criticized the Trump administration for imposing ambiguous wording rules and guidelines on the application of the restrictions. Investors have also expressed concern about the confusion that has been sown over the past few weeks.
“This kind of uncertainty is not attractive to any long-term investor, especially if you are trying to invest in Chinese state-owned telecommunications companies,” Deepak Puri, America’s chief investment officer for Deutsche Bank Wealth Management, said amid the NYSE flip. -flop last week.