China Telcos Plunge On Index Removal

The mainland’s three biggest telecom companies saw their shares listed in Hong Kong slide as much as 11 percent during early trading on Friday, after index provider FTSE Russell announced it will remove them from its global indices.

FTSE explained that the decision against China Mobile, China Unicom and China Telecom was in response to Washington’s blacklisting of the firms.

It said the changes to the FTSE Global Equity Index Series and the FTSE Global China A Inclusion Indexes and associated indices will take effect on Monday, when the US ban on the trading of companies it deems as being linked to the Chinese military takes effect.

Shortly after the FTSE announcement, another index provider, MSCI, also announced it will remove the mainland telco firms from its products, including the MSCI China All Shares Indexes, by the end of Friday.

The decisions came a day after S&P Dow Jones Indices (S&P DJI) said it will take out the American Depository Receipts from its benchmarks, reversing an earlier decision not to do so.

S&P DJI had cited decisions by the New York Stock Exchange (NYSE) for the U-turn.

The NYSE is set to delist the mainland firms on Monday after changing its decision twice this week.