The administration of the President of the United States (US), Donald Trump is reportedly considering blacklisting Alibaba and Tencent from investing in the country's market.
The report was revealed by two sources who knew about the matter.
If the report is true, Trump will take the most dramatic step in cracking down on Chinese companies during the last days of his administration.
Alibaba and Tencent are the most valuable companies in Asia, with a total market capitalization of both companies worth US $ 1.3 trillion.
The Department of Defense, which is handling the move, has not yet finalized the plan and is considering adding more Chinese firms to the blacklist.
Both companies however declined to comment.
Following the report, Alibaba and Tencent shares declined about 4% during the afternoon trading session on the Hong Kong Stock Exchange while Alibaba shares in the US also declined by 5%.
Yesterday, Trump ordered transaction restrictions on eight software including payment applications Alipay and QQ Wallet as well as WeChat Pay.
