Shares of China’s three major telecom carriers fell Monday after the New York Stock Exchange said they would scrape the shares to comply with a US government ban.
During Monday morning trading in Hong Kong, shares of the largest, China Mobile Ltd., fell a whopping 4.5%, putting the stock on track for its lowest close since June 2006. Shares of smaller competitor China Telecom Corp. lost as much as 5.6%, while China Unicom was down 3.8%.
The NYSE said Friday it would suspend trading in securities issued by the three companies by Jan. 11, while halting trading in closed-end funds and exchange-traded products containing banned stocks.
An executive order signed by President Trump in November blocks Americans from investing in companies that the U.S. government says are helping the Chinese military on Jan.11. It is another setback for American investors in Chinese telecom companies. These groups are among the largest global telecommunications providers, but have largely lagged behind the broader markets since the companies began listing in the US more than 20 years ago.
The three Chinese companies said holders of their US certificates can exchange those securities for their Hong Kong-listed common stock through Bank of New York Mellon, the depository of all three ADR programs.