The Major US Indices and FTSE Russell to remove more Chinese firms from their indices following a new U.S. executive order, banning domestic investment in companies with links to China’s Military. Chinese A50 Index is down -2.96%.
- The US index publisher pointed out 25 Chinese companies would be removed from its index on 2nd August, while FTSE Russell would remove 20 firms on July 28.
- The move could worsen the situation for U.S.-listed Chinese companies working with Chinese government to control the tech sector and impose tighter data security regulations.
- US capital markets are a major source of funding for Chinese firms, more so technology companies who tap into a big liquidity pool.
- In the last few weeks, Chinese authorities have cracked down on several companies looking to list in the US with cybersecurity investigations.
- After its $4.4 billion listing in NYSE, Didi became a major target of China’s crackdown on US-listed tech firms.