Huawei supplier surges in Hong Kong after cancelling NYSE listing

Bloomberg

A major Chinese chipmaker surged in Hong Kong amid prospects that its decision to stop trading in New York will attract more volume to its main listing.
Semiconductor Manufacturing International Corp was Monday’s top gainer on the MSCI China Index as well as its Asia-Pacific gauge with a 10 percent rally.
It was a different story for its American depositary shares, which tumbled 5.6 percent in New York after the Shanghai-based firm said it was delisting due to considerations including limited trading volume and costs. SMIC’s biggest customer is the parent of Huawei Technologies Co, the high-profile subject of a US ban.
“The rise in the shares today is mainly due to expectations that US trades in the stock
will be funneled over to the Hong Kong-listed company, meaning more demand for the Hong Kong-listed stock,” Csc International Holdings analyst Zhu Jixiang said.
The decision could also be linked to the escalation in Sino-US trade tension, he said.
“SMIC is one of the top foundries, and right now semiconductors are a sensitive area,” Zhu said. “The company executives might be retreating to save themselves potential worries in the future — after all, being listed in the US means they are subject to securities regulation and frequent executive travel to the US.”
SMIC didn’t respond to calls for comment.