S&P Dow Jones Indices Inc. announced Thursday (Dec. 10) that it will remove 21 Chinese companies from its global stock and and bond indexes based on orders from the Trump administration, preventing U.S. investors from buying shares of those companies.
The index provider said it will take the stocks of 10 Chinese companies, including Hikvision, Semiconductor Manufacturing International and Sinosolar, out of its stock and bond indexes from Dec. 21, before the stock market opens, according to international media on Dec. 10. It also plans to take out bonds issued by 11 Chinese companies from its fixed-income index before the market opens on Jan. 1 next year.
This follows a similar move by British index provider FTSE Russell last week to remove eight Chinese companies from its product range.
Chinese Foreign Ministry spokeswoman Hua Chunying expressed firm opposition to the U.S. government’s move at a press conference on Thursday, calling it another example of the U.S. using state power and abusing the concept of national security to suppress Chinese companies.
The Trump administration issued an executive order on Nov. 12 prohibiting U.S. investment firms, pension funds and other financial institutions and individuals from owning or trading in any securities issued by companies that the U.S. Department of Defense determines to have a Chinese military background. The executive order was issued so that the stocks and securities of the affected Chinese companies no longer qualify for the index.
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