(Reuters) The global index providers MSCI and FTSE Russell want to remove three Chinese telecom companies from their indices in response to the US sanctions. China Mobile is affected (CHL 26.10 -5.95%), China Telecom and China Unicom Hong Kong, which fell sharply on Friday. China Mobile hit a 14-year low and China Telecom stocks fell to their 12-year lows. In the meantime, the three telecom companies lost $ 10 billion in market value. In addition, the stock exchange operator NYSE will be banning the three companies from stock trading on Monday.
With this step, the index providers and the NYSE are reacting to a ban by the US government. Accordingly, as of November, Americans will be prohibited from investing in Chinese companies that are said to have ties to the Chinese military. Other companies from the People’s Republic have therefore already been removed from indices, which often means that index tracking funds also sell their shares. Speculation that the ban will affect the technology giant Alibaba is also causing unrest in the market (BABA 226.90 -0.31%) and Tencent (Tencent 72.85 -1.05%) could be expanded.
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