BlackRock, Fund Managers Brace for Even More Scrutiny Over China

BlackRock Inc., MSCI Inc. and other firms are bracing for tighter oversight following a congressional probe over investments in Chinese companies deemed to be national security threats and an executive order curtailing specific investments there.

More than 2,000 US mutual and exchange-traded funds — particularly those tracking indexes — have $294 billion invested across Chinese stocks and bonds, according to data compiled by Bloomberg, though not all of that money is invested in companies facing lawmakers’ scrutiny.

Vanguard Group, BlackRock, Fidelity Investments and DWS Group manage funds with investments in China, some of which are the type that ...