Stocks of several Chinese companies slid on Sept. 27 following a report from Bloomberg News saying that the White House is discussing de-listing Chinese companies from United States stock exchanges.
Technology stocks, which are particularly sensitive to the swings in the trade conflict between the United States and China, accounted for much of the selling.
Bloomberg cited an unnamed source as saying the Trump administration is considering ways to limit U.S. investors’ portfolio flows into China.
Shares of Alibaba Group Holding, JD.com, Baidu, and others, fell between 2 percent and 4 percent in afternoon trading.
China’s yuan fell .4 percent in offshore markets against the dollar after the news—nearly the weakest compared to U.S. currency in about three weeks.
“My recommendation for the people watching is, you know, if you can avoid that, if you’re not in the business of trying to trade daily, that you do avoid that, and you focus on the fundamentals,” said Portfolio Manager Paul J. Kleinschmidt of Tocqueville Asset Management.
One analyst told Bloomberg this could be a way for the United States to provide safeguards for American investors while restraining China’s growth.
The report cites three unnamed sources as saying the United States might also put limits on the Chinese companies included in stock indexes managed by U.S. firms, but that it’s still not clear how that would be done.
This could be a blow to China’s economy, which has suffered under the U.S.-China trade war.
As of February, federal data showed that 156 Chinese companies were listed on the NASDAQ and New York Stock stock exchanges.
Reuters contributed to this article.
