NYSE to delist Chinese telecoms after all

The New York Stock Exchange reversed course again, saying Wednesday that it would remove China’ s three major state-run telecommunications companies from the exchange.

The decision cameafter a day of pressure from the Trump administration and Congress following a decision by the exchange to let the companies — China Unicom, ChinaTelecom and ChinaMobile— remain listed. That twist came a week after the NYSE said the company’s shares would be delisted to comply with President Donald Trump’s executive order on China investments.

The exchange said in a statement that it was complying with U.S. law and that the latest decision came following “new specific guidance” that it received from the Treasury Department’s Office of Foreign Assets Control.

The delisting is likely to further inflame tension between the United States and China in the final days of the Trump administration. The back and forth also reflected the lingering tensions within the administration about how hard a line to take against China, with the Department of Defense and the State Department pushing for a more expansive reading of Trump’s executive order to block Americans from investing in companies tied to the Chinese military.

Treasury Secretary Steven Mnuchin, who had initially supported greater accommodation of Chinese companies, pushed Tuesday for the companies to be delisted after Sen. Marco Rubio, R-Fla ., and Pentagon officials expressed outrage that they would remain on the exchange. The Treasury secretary, who was traveling in Egypt on Tuesday, called Stacey Cunningham, president of the NYSE Group, to voice his objection to the decision not to delist and issued updated guidance.

A person familiar with the process said that the Treasury Department provided NYSE with new guidance Tuesday night thatmade clear that the companies were covered by the executive order.

The NYSE had said a week ago that it was moving ahead with the delistings before backtracking Monday night after consultations with U.S. regulators, it said. The apparent reprieve led to a sharp rise in the companies’ New Yorklisted stocks Tuesday, with China Unicom, for example, gaining nearly 12 percent on the day.

In explaining the initial reversal, the exchange pointed to ambiguity in the White House order about whether it applied to subsidiaries and affiliates. The latest reversal pushed the stocks back down Wednesday, but not by enough to erase all the previous day’s gains.

MSCI, FTSE Russell and S&P Dow Jones Indices have dropped Chinese firms from their global indexes in recent weeks following U.S. restrictions on owning their shares.

The New York Stock Exchange will stop trading of shares in the companies Monday.