American index MSCI is removing 10 Chinese stocks accused of having links to the People’s Liberation Army. The decision to remove the listings comes weeks before U.S. President Donald Trump’s executive order banning investments into select Chinese stocks comes into effect.
MSCI’s move following similar measures implemented by other U.S. index providers as the trade war between the country and China continues to worsen.
MSCI said that the 10 Chinese stocks will be removed from its Global Investable Market Indexes and other related indices start on January 5.
“For years American investors have unknowingly financed Chinese Communist military companies, which help the PLA threaten US and allied service members… Under President Trump’s leadership, this is coming to an end,” National Security Council representative John Ullyot said.
The 10 stocks that will be removed from the U.S. index include Hikvision, China Semiconductor Manufacturing International Corp, CRRC Corp, Dawning Information Industry, China Spacesat, China Railway Construction, and China Communications Construction Co.
MSCI said that it had run a poll with more than 100 domestic and international investors before it reached its final decision. The majority of the poll’s participants reportedly agreed the move to remove the listings is justified given the possible ramifications of Trump’s executive order.