Major US investors have billions at risk in Chinese stocks

Major United States fund managers have tens of billion of dollars at stake in some of the most popular Chinese stocks on Wall Street, exposing them to potential losses should the White House move to delist Chinese firms from US exchanges.

White House trade adviser Peter Navarro on Monday dismissed reports that the Trump administration was considering delisting Chinese companies from US stock exchanges as "fake news", helping Chinese stocks including JD.com and Alibaba Group Holding recover some of their declines from Friday after the reports emerged.

As Navarro's comments reduced investor fears, the S&P/BNY Mellon China Select ADR index rose 1.1 per cent after tumbling more than 3pc on Friday. Still, the possibility of a future US move to boot Chinese companies out of U.S. markets remains a topic of concern for investors.

"The proposed measures would completely undermine the international ADR/GDR etc. market and would harm the US' role as a conduit for international capital," Jefferies equity strategist Sean Darby wrote in a client note.

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