Three major Chinese telecom firms have lost $5.6 billion in their value after leading index providers dropped them from their benchmark portfolios.

China Mobile, China Telecom, and China Unicom have now shed more than 20 per cent of their value since November.

That was when US president Trump signed an executive order banning US citizens from investing in Chinese firms deemed by the US government to be close to the Chinese military, which includes telco infrastructure provider Huawei.

Index providers MSCI, FTSE Russell and S&P Dow Jones said they would cut the three Chinese telecom companies from their benchmarks.

The move will force index tracking funds to sell their stock in those companies.

The announcement wiped a combined $5.6 billion off the value of the three telcos' Hong Kong-traded shares this morning (Friday).

The decision by the index providers came shortly after the New York Stock Exchange moved to de-list the three firms’ shares on 11 January.

China’s foreign ministry said it “firmly opposes” the US government's “abuse of power” to “oppress” Chinese companies.

The US government maintains Huawei and other Chinese companies are potential “spying threats” as tools of the Chinese government, which all the companies deny.

Share Story: