HONG KONG—Shares of ZTE Corp. lost more than a third of their value in their first day of trading in nearly two months, reflecting investors’ unease about the future of the Chinese telecommunications giant following devastating U.S. sanctions.
Shares fell about 40% to 15.36 Hong Kong dollars (US$1.96) in the opening minutes of trading in Hong Kong, wiping out nearly $8 billion in market value. The trading halt, which began April 17, followed an order from the U.S. Commerce Department banning American companies from selling to ZTE, effectively shuttering its business.
The company got a lifeline last week after Commerce Secretary Wilbur Ross announced a deal to keep ZTE in business in exchange for fines and a change in management. That deal paved the way for ZTE shares to resume trading, and the company said Tuesday it would restart business operations “as soon as practicable,” though the sales ban remains in place until ZTE pays the fines.
But ZTE’s fate is again in limbo, as a bipartisan effort to block ZTE’s rescue moves forward in Congress. Senior Republican senators indicated Tuesday that their efforts to keep sanctions on ZTE—via an amendment to a must-pass defense bill—aren’t being met with opposition from the White House.