The New York Stock Exchange reversed its decision to delist three Chinese tech companies with ties to the Chinese military on Monday night.
The exchange announced on Dec. 31 that it would remove China Telecom, China Mobile, and China Unicom to comply with President Donald Trump's executive order, which banned all investments in Chinese companies that have ties to the Chinese military. The exchange now says it "no longer intends to move forward with the delisting action" after discussions with regulatory authorities.
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"At this time, the Issuers will continue to be listed and traded on the NYSE. NYSE Regulation will continue to evaluate the applicability of Executive Order 13959 to these Issuers and their continued listing status," the exchange said in a statement.
Shares of the three companies plummeted after the exchange's New Year's Eve announcement, prompting the Chinese government to threaten "necessary countermeasures" to oppose the delisting on Saturday. The companies surged as trading began Tuesday. China Mobile increased by 10 percent, while China Unicom increased by more than 13 percent. Shares of China Telecom also increased by 7 percent in the wake of the exchange's reversal.
It remains unclear whether the exchange's flip-flop will put it in conflict with Trump's executive order, which banned Americans from trading shares of Chinese military-linked companies after Jan. 11. The ban affected more than 30 Chinese companies, not all of which are publicly traded. The order was a key policy in the larger push against Chinese companies that trade in the United States. In December, Congress passed bipartisan legislation to require Chinese companies to comply with American accounting standards or face delisting—a measure opposed by China.
Update: January 6, 2021
The New York Stock Exchange once again reversed its decision on Wednesday morning after the Department of Treasury told the exchange that the executive order banned Americans from investing in the three companies. The stock exchange will suspend trading of the three shares in the early hours of January 11, hours before the executive order goes into effect. Shares of the three companies fell by 1 to 3 percent in the wake of the announcement..