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Major U.S. investors have billions at risk in Chinese stocks

Published 10/01/2019, 01:09 AM
Updated 10/01/2019, 01:16 AM
Major U.S. investors have billions at risk in Chinese stocks

By Noel Randewich

SAN FRANCISCO (Reuters) - Major U.S. fund managers have tens of billion of dollars at stake in some of the most popular Chinese stocks on Wall Street, exposing them to potential losses should the White House move to delist Chinese firms from U.S. exchanges.

White House trade adviser Peter Navarro on Monday dismissed reports that the Trump administration was considering delisting Chinese companies from U.S. stock exchanges as "fake news," helping Chinese stocks including JD.com (O:JD) and Alibaba Group Holding (N:BABA) recover some of their declines from Friday after the reports emerged.

(GRAPHIC: S&P/BNY Mellon China ADR index - https://fingfx.thomsonreuters.com/gfx/mkt/12/6760/6691/Index.png)

As Navarro's comments reduced investor fears, the S&P/BNY Mellon China Select ADR index (BKTCN) rose 1.1% after tumbling more than 3% on Friday. Still, the possibility of a future U.S. move to boot Chinese companies out of U.S. markets remains a topic of concern for investors.

"The proposed measures would completely undermine the international ADR/GDR etc. market and would harm the US's role as a conduit for international capital," Jefferies equity strategist Sean Darby wrote in a client note.

Leading U.S. investors across Chinese companies listed on U.S. exchanges include Blackrock (NYSE:BLK), T. Rowe Price Associates and the Vanguard Group, with over $40 billion invested, according to Refinitiv data, based on fund filings.

(GRAPHIC: Top U.S. investors in Chinese companies listed in the U.S. - https://fingfx.thomsonreuters.com/gfx/mkt/12/6755/6686/Chinese%20Companies.png)

After Monday, Chinese markets will be closed for a week-long holiday marking the 70th anniversary of the founding of the People's Republic of China. U.S.-listed shares of Chinese companies will continue to trade during that time, exposing them to more potential volatility.

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The graphics below show leading U.S. investors' exposures to four major Chinese companies popular on Wall Street, based on Refinitiv data.

(GRAPHIC: Top U.S. investors in Alibaba - https://fingfx.thomsonreuters.com/gfx/mkt/12/6756/6687/BABA.png)

(GRAPHIC: Top U.S. investors in Baidu (NASDAQ:BIDU) - https://fingfx.thomsonreuters.com/gfx/mkt/12/6757/6688/BAIDU.png)

(GRAPHIC: Top U.S. investors in JD.com - https://fingfx.thomsonreuters.com/gfx/mkt/12/6758/6689/JD.png)

(GRAPHIC: Top U.S. investors in Tencent - https://fingfx.thomsonreuters.com/gfx/mkt/12/6759/6690/Tencent.png)

Latest comments

your ancestors misspelled your last name. they forgot the "r". you will always be "wrong" with you shallow mind process. the people of China will suffer even more. America is so great you even change your first name trying to be American. disgraceful Chinese.
I told you guys ... President Xi already said ... no nation can stop the raise of China and the chinese people. Trump can play cowboy and do what he wants, but he has to understand, President Xi commands a 1.4B consumer army and Trump commands 320M. When these two forces meet across the economic battlefield, who do you think will win?
how can they play fake news game ?
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