MSCI deletes three Chinese telcos from its global indices, shares fall
Global index publisher MSCI will delete China Mobile, China Telecom and China Unicom Hong Kong from its global indices at the close of business on Friday, adding fresh selling pressure to the companies' Hong Kong-listed shares after an investment ban by the U.S.
MSCI said it would drop the three telcos from its flagship global equity index MSCI ACWI Index, MSCI China All Shares Index and other related indices following further guidance from the Office of Foreign Assets Control, an arm of the U.S. Treasury Department.
The Chinese telecoms stocks represented 0.07 percent of the MSCI ACWI Index and 0.81 percent of the MSCI China All Shares Index as of Wednesday, according to MSCI.
Hong Kong-traded shares of China Telecom, China Unicom and China Mobile all closed lower in Friday's trading, down 3.45, 0.9 and 4.16 percent, respectively, unwinding earlier losses on the day of near eight percent.
The removal came a day after the New York Stock Exchange (NYSE) announced to move forward delisting of the three companies in accordance with new guidance from the U.S. Treasury Department as second reversals in two days.
NYSE's delisting is to comply with an executive order issued in November by the Trump administration that imposes restrictions on companies identified as "affiliated with the Chinese military".
Other major stock and bond index providers have taken similar removal steps. FTSE Russell is removing China Mobile and China Telecom from its FTSE China 50 Index effective from Monday. S&P Dow Jones Indices also said Thursday it will expel the three telecom companies.