Just a few short days ago, it was being reported that three giant Chinese Telecom giants – China Unicom Hong Kong, China Mobile, China Telecom – were to be delisted from the New York Stock Exchange (NYSE) following an executive order from President Trump.
The companies were expected to be suspended sometime this week (as early as tomorrow) or very nearly next week, primarily because they either support or supply the Chinese Military in some fashion.
However, with absolutely no further explanation or clarification, the NYSE has decided to completely reverse their decision and disobey President Trump’s order. Here is the letter from their official website:
“In light of further consultation with relevant regulatory authorities in connection with Office of Foreign Assets Control FAQ 857…
…the New York Stock Exchange LLC (NYSE) announced today that NYSE Regulation no longer intends to move forward with the delisting action in relation to the three issuers enumerated below (the ‘Issuers’) which was announced on December 31, 2020.
At this time, the Issuers will continue to be listed and traded on the NYSE.
NYSE Regulation will continue to evaluate the applicability of Executive Order 13959 to these Issuers and their continued listing status.”
Quite uncharacteristic of the NYSE to do something like this, especially as this decision seems particularly motivated by politics.
As you can imagine, shares of all three companies went up during yesterday’s trading session:
- China Unicom: +11.72%
- China Telecom: +8.46%
- China Mobile: +9.23%
ZeroHedge chimed in on why this would have happened, suspecting that China may have quietly “threatened” the NYSE in some fashion…
“The ministry of commerce said in a statement that China will ‘take necessary measures to resolutely safeguard the legitimate rights and interests of Chinese enterprises,’ according to the state-run Global Times.
The commerce ministry said that the US was ‘abusing national security and using state power to crack down on Chinese enterprises’ and said the move was ‘not in line with market rules and logic, which harms not only the legitimate rights of Chinese enterprises, but also the interests of investors in other countries, including the US.’”
However, the Financial Times has a much more straightforward explanation:
“Equity traders said the NYSE’s sudden reversal was in line with growing market expectations that the administration of President-elect Joe Biden would take a less combative approach towards Chinese groups that have tapped American capital markets.”
In other words, there is the expectation that Biden will reverse this executive order from Trump and allow their shares to continue trading freely on the NYSE.
Of course… with TODAY being the day where the Electoral College votes are officially certified or decertified, there’s no telling what the future will be for these three Chinese companies.
What do YOU think about the NYSE’s out-of-nowhere decision to reverse their stance on delisting the Chinese companies? Reply to this newsletter and share your thoughts with us!
Hallelujah – A POSITIVE Stock Trading Day in 2021!
After Monday’s dismal start to the trading year of 2021, yesterday proved to be a little better as the world starts placing some optimistic bets on the world economy making a much-needed recovery.
Here are the most important numbers you need to know about Tuesday’s stock market performance:
- Dow Jones: +0.6%
- S&P 500: +0.7%
- NASDAQ: +1%
What’s driving the markets this time, you may ask? It’s the Georgia Senate runoff elections that took place yesterday, with the votes still being counted. Of course, if two Democrats end up winning, Republicans will lose their majority control of the Senate. As The Sevens Report founder Tom Essaye writes:
“We don’t view a Democrat Senate as a bearish game changer in the short term because there would still be a lot of positives in this market. But it would be a new and unaccounted for initial head-wind on stocks.”
If you think yesterday’s market activity was volatile, just wait for today. There’s no telling how the market will react when all of the Electoral College votes for Biden and Trump have been certified… IF they get certified.
People Are Spending 16.1% MORE on Home Improvements
Breitbart recently reported on a growing trend within the home construction industry. One that makes sense when you consider that people are running out of things to do at home. Seems like all of those “home renovation” projects we’ve been procrastinating on for years are FINALLY getting done:
“Private sector construction spending on single-family homes jumped a seasonally adjusted 5.1% in November compared with October, bringing the year-over-year gain to 18.1%.
Spending on single-family home construction in November hit a seasonally adjusted $341.5 billion, according to data released by the Census Bureau Monday. Private sector apartment construction was more or less unchanged at $90 billion.
For the first 11 months of the year, private residential spending rose 6.2% in single family construction spending and a 5.0% in multifamily construction.
Including home improvements, private sector construction spending rose to $658 billion, a 2.7% monthly gain and a 16.1% gain from the year-ago level. On a year-to-date basis, this is up 10.2%, an indication that Americans have poured lots of investment into their existing homes this year.”
Maybe it’s time to make some changes in the home for 2021? So long as the lockdowns continue, we might as well enjoy the environment we find ourselves in, day in and day out…
Magna: The Company Poised to Build the Apple Car?
Rumors have been flying around the tech industry about Apple and their plans to build their own autonomous electric-powered vehicle. However, the question remains about which company will get the honor of having the manufacturing outsourced to them.
According to The Financial Post, the answer to that question is a Canadian company known as Magna International Inc:
“Even if Apple doesn’t come knocking, the manufacturer is already advising tech groups and startups looking to enter the automotive business, and investors have taken notice. Magna’s shares have almost trebled since March, giving it a US$21-billion market value.
Magna is one of the world’s biggest car-parts suppliers, having generated nearly US$40 billion of revenue in 2019 from products such as transmissions, vehicle cameras, mirrors and seating… In 2019 Magna assembled almost 160,000 vehicles — more than many carmakers produce — and generated US$6.7 billion of revenue from these activities.”
At this point, it’s far too early to say who it will be, as we don’t even know how far Apple is in creating their very first prototype. They have a LONG road ahead of them before they can even hope to become a competitive rival to Tesla.
But if they can fix upon all of the existing problems of the electric vehicle industry while presenting a superior product, they might have a shot at tackling a completely new sector.