How Hong Kong Sanctions Could Threaten Wall Street

Citigroup Inc., JPMorgan Chase & Co., HSBC Holdings Plc and their peers face a threat to their massive expansion plans in China as a deepening standoff between the U.S. and China over Hong Kong has sparked tit-for-tat sanctions on politicians and officials on both sides in a conflict that could escalate.

U.S. President Donald Trump sanctioned 11 officials, including Hong Kong’s Chief Executive Carrie Lam and China’s two top officials in the city, following passage of a law that calls for penalties on foreign persons and entities who have “materially” contributed to undermining Hong Kong’s autonomy from the mainland. It also allows for penalties on foreign financial institutions that knowingly do business with sanctioned individuals. China retaliated with sanctions on 11 Americans, including five members of Congress, but provided no details on what they would entail.