US considering restricting government pension fund investments in China: Report

Shares of Chinese companies that trade in the U.S. traded lower Tuesday following reports that the White House is considering restricting government pension fund investments in China.

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A source familiar with the matter confirmed the thinking to FOX Business' Blake Burman after a Bloomberg report. The source stressed that U.S. negotiators are considering multiple options and haven't made a final decision.

Nuveen chief equity strategist and senior portfolio manager Bob Doll responded to the reports on "Mornings with Maria."

"I think it's important in the sense that it sends a message that we’re going to fight with fire," Doll said Tuesday. "I think the actual indications are smokescreens – they could actually go there – but this is just before we’re supposed to sit down and have, I think it's round 14 of the talks, and it doesn’t make people walking in to those tables feel very good, so not a good sign."

TickerSecurityLastChangeChange %
BABAALIBABA GROUP HOLDING LTD175.29+4.13+2.41%
WBWEIBO CORPORATION49.32+0.75+1.54%
NTESNETEASE INC.286.29+9.70+3.51%
JDJD.COM INC31.00+1.17+3.92%

White House trade official Peter Navarro called a report last month that the U.S. was talking about delisting Chinese companies from U.S. exchanges "fake news."

The Commerce Department on Monday put eight Chinese tech companies on its entity list, which bars U.S. firms from selling technology to the Chinese companies without government approval.

Doll said the U.S. blacklist shows the importance of "trying to stay away in portfolios from things that have to do with China because you never know what’s around the next corner."

"Companies that do most of their business in the U.S. have outperformed those who are more international both for the reason we’re discussing now and more broadly, economic growth – better in the U.S., not so outside the U.S," he told Maria Bartiromo.

Amid these headlines, White House economic adviser Larry Kudlow sounded optimistic.

White House chief economic adviser Larry Kudlow speaks with reporters outside the White House, Friday, May 3, 2019, in Washington. (AP Photo/Evan Vucci) (AP Photo/Evan Vucci)

Kudlow said Monday the U.S. is open to a short-term deal as long as "structural issues," like market access for U.S. companies and the Chinese government subsidizing state-owned companies, are addressed.

“We are open to a number of ideas, some may be short term, some may be long term,” Kudlow told reporters outside the White House. “It’s essential that the structural issues that we've talked about for two years since I’ve been around ... that stuff’s gotta get solved.”

Kudlow added that Chinese negotiators have been a “little more cooperative recently” as they have recently purchased U.S. agricultural products like soybeans, pork and wheat.

The Associated Press, FOX Business' Kyle Beck and Matthew Kazin contributed to this report.