Tensions between US and China have escalated, after Donald Trump proposed to ban more Chinese companies, including Tencent and Alibaba.

Last week, Washington reported that Trump proposed to ban $ 1.3 trillion worth of companies, despite the fact that their shares are owned by almost every major US investment fund.

This attack is the most dramatic move that the incumbent US president has made, in an attempt to solidify his tough policy on Beijing in his final days in power.

Goldman Sachs estimates that US investors own about $ 1 trillion in Chinese internet and technology assets.

"Turning off 1 trillion investments (if you take away Alibaba and Tencent) is a lot!" Said Vivian Lin Thurston, manager and equity analyst at William Blair Investment Management. "This has never happened in any global market before," she added.

Meanwhile, UBS estimates that over a third of Alibaba's $ 616 billion market capitalization belongs to US investors.

The two companies also account for nearly 11% of the MSCI's $ 7 Trillion Emerging Markets Index, which they joined respectively from 2008 to 2015. Chinese companies now account for 40% of the index, up from 17% ten years ago.

UBS also said that even if the new president, Joe Biden, wants to lift the ban, the administration may not agree with it.

Now, Chinese investors have begun to actively buy back some of the unloaded shares.

The Trump administration has also questioned both Tencent and Alibaba's financial technology subsidiary, Ant Group, for some time.

Just last week, Trump signed an executive order banning US transactions using Alipay, WeChat, and QQ Wallet over concerns that they could be used to "track the location of federal employees" and "create dossiers of personal information."

In response, China's Foreign Ministry said the US was abusing its power and unreasonably suppressing foreign firms with these measures.

Tencent and Alibaba declined to comment.