Trump's trade war against China has slowed down the number of Chinese tech firms launching their initial public offerings (IPOs) on the tech-heavy NASDAQ Composite Index of the NASDAQ Stock Market on Wall Street.
NASDAQ and the two other major U.S. stock indices -- the Dow Jones Average and S&P 500 -- expected more than 40 Chinese IPOs this year, but will end 2019 with IPOs in the "mid-30s," said Robert McCooey, senior vice president of NASDAQ's Listing Services unit at CNBC's East Tech West conference at Guangzhou on Wednesday.
The NASDAQ Composite Index is the market capitalization-weighted index of over 3,300 common equities listed on the NASDAQ stock exchange. This setback hasn't fazed NASDAQ, however, claimed McCooey.
"If there were 35 to 50 Chinese companies that came to the U.S. every year from here to infinity, I think we would be very blessed," he said.
More than 150 Chinese companies were traded on the Dow, S&P 500 and the NASDAQ as of February, said the United States-China Economic and Security Review Commission (US-China Commission). Their total market value came to $1.2 trillion.
A congressional commission of the federal U.S. government, the US-China Commission is responsible for monitoring and investigating national security and trade issues between the U.S. and China.
NASDAQ, however, won't accept just any Chinese tech firm. It wants to see increased scrutiny for Chinese companies looking to list on Wall Street. It's been reported that NASDAQ has begun slowing down approvals for smaller Chinese firms preparing to list.
The US-China Commission is prodding the U.S. Congress to add new regulations, which include requiring Chinese companies to disclose any financial support from President Xi Jinping's communist government.
In an interview with Xinhua News Agency last May, McCooey said NASDAQ "saw a great year with 22 IPOs from China on Nasdaq last year (2018), already 15 from China this year. So we expect that we should surpass last year's number and the pipeline continues to be very, very strong for Chinese companies who are interested in accessing the U.S. capital markets."
U.S. equity market witnessed an IPO boom in 2018 with a total of 43 Chinese companies listing on Wall Street that year, a marked jump from the 24 firms listing in 2017 and 10 in 2016.
