Trump mulls delisting Chinese firms from US markets

Move seen as radical escalation of trade tensions

WASHINGTON, Sept 28, (RTRS): President Donald Trump’s administration is considering the possibility of delisting Chinese companies from US stock exchanges, a source briefed on the matter said on Friday, in what would be a radical escalation of trade tensions between the two countries.

The move would be part of a broader effort to limit US investments into China, the source said, confirming an earlier report by Bloomberg that sent shockwaves through financial markets.

Shares of Alibaba Group Holding, JD.com, Pinduoduo, Baidu, Vipshop Holdings, Baozun and IQIYI fell between 2% to 4% in afternoon trading.

China’s yuan currency, traded in off shore markets, fell by 0.4% against the dollar after the news to trade near its weakest against the greenback in about three weeks.

Exact mechanisms for how to delist the companies were yet to be worked out and any plan is subject to approval by President Donald Trump, who has given the green light to the discussion, Bloomberg reported, citing a person close to the deliberations.

Officials are also examining how the US could put limits on the Chinese companies included in stock indexes managed by US firms, although it was not clear how that would be done, the agency cited three sources as saying.

A bipartisan group of US lawmakers in June introduced a bill to force Chinese companies listed on American stock exchanges to submit to regulatory oversight, including providing access to audits or face delisting.

Chinese authorities have long been reluctant to allow overseas regulators to inspect local accounting firms - including member firms of the Big Four international accounting networks citing national security concerns.

As of February, there were 156 Chinese companies listed on the NASDAQ and New York Stock Exchanges, according to government data, including at least 11 state-owned firms.

NYSE declined to comment on Friday while Nasdaq, MSCI, S&P and FTSE Russell all did not immediately respond to requests for comment.

Trade talks between the United States and China are expected to resume next month after months of titfor-tat moves by both sides which have weakened global growth and driven rollercoaster moves in markets.

“It’s all very disruptive, it just adds to uncertainty and its a big negative for business investment,” said Scott Brown, chief economist at investment bank Raymond James. He noted, however, that both sides have tended to use aggressive moves in the past as leverage ahead of talks.

“You never know if its a ploy to get some leverage,” he said. DETROIT, Sept 28: (AP): General Motors now says striking workers will get company-paid health insurance, nine days after telling the union that coverage would be cut off.

The automaker said in an emailed letter to the United Auto Workers dated Wednesday that employee health and well-being are GM’s top priorities.

The about-face came after workers howled and GM received withering criticism from politicians and on social media about cutting off the benefits.

“These irresponsible actions by General Motors are toying with the lives of hundreds of thousands of our UAW families,” UAW Vice-President Terry Dittes wrote in a letter Thursday to Scott Sandefur, GM’s vice-president of labor relations. Dittes wrote that public sentiment would “see these actions of GM as a shameful act!”

It wasn’t clear how the rhetoric or the healthcare spat would affect contract talks aimed at ending the strike by 49,000 workers that has shut down manufacturing for nearly two weeks at more than 30 GM plants across the nation.

“This is an attempt to do what’s right for our employees,” GM spokesman Dan Flores said.

It’s normal procedure in strikes for the cost of healthcare to shift from the company, which is largely self-insured, to the union. It says on the union website that the UAW will pick up the cost of the premiums. But the timing of when GM ends the healthcare and when the union takes over is at issue. The UAW said the benefits lapsed, but did not give a date.

Sandefur wrote in his letter that GM has chosen to work with health providers to keep benefits fully in place for workers “so they have no disruption to their medical care, including vision, prescription and dental coverage.”

Another GM plant, this time in Mexico, has been forced to close due to parts shortages caused by the strike, the company confirmed Thursday. An engine factory in Silao, Mexico, which employs 500 people, has closed, the company said, but pickup truck assembly and transmission plants at the same site remain open. Workers can take vacation time or they’ll get an unspecified portion of their pay, GM said. One plant and part of another have been closed in Canada.

Contract talks continued into Thursday night, a day after Dittes wrote a letter to members saying that committees had finished their work and the talks had moved to the main table of top bargainers, a sign of progress. Experts say the top bargainers would have to decide contentious economic issues such as wages, profit sharing, giving temporary workers a path to full-time jobs, products for plants GM wants to close and other issues that could take a lot of time.

On Detroit-area picket lines Thursday, workers said GM’s restoration of health care benefits makes them think that a contract agreement is near.