Mainland Chinese Shares Fall Two-Percent, Huawei’s American Suppliers Pressured
The major Asia/Pacific stock markets were mostly lower on Friday bucking the trend on Wall Street. U.S. investors may have been driven by strong earnings and economic data while Asian investors were still being cautious about playing the long side during a period of heightened volatility due to renewed tensions between the United States and China.
At 06:12 GMT, Japan’s Nikkei 225 Index is trading 21270.19, up 207.21 or +0.98 percent. Hong Kong’s Hang Seng Index is at 27943.32, down 331.75 or -1.17 percent.
Shares in China and South Korea were also lower. In China, the Shanghai Index is trading 2899.03, down 56.68 or -1.92 percent, and in South Korea, the KOSPI Index is at 2059.64, down 8.05 or -0.39 percent.
In Australia, the S&P/ASX 200 is trading 6365.60, up 37.60 or +0.59 percent.
In Japan, the Nikkei 225 was boosted by a jump in Sony, which surged more than 10% after the company announced a $1.83 billion share buyback and a new partnership with competitor Microsoft.
Shares of Huawei’s American Suppliers Slide
Shares in China continued to be pressed by the ongoing trade tensions between Beijing and Washington. Furthermore, new concerns over U.S.-China trade relations after Huawei was added to the U.S. Bureau of Industry and Security’s so-called Entity List, also weighed on prices.
The decision means American firms will need to get a license from the government to sell or transfer technology to Huawei.
Although China has not announced any retaliatory moves against the U.S. in reaction to the move against Huawei, U.S. firms still took a hit in anticipation of a drop in business. Qualcomm was down 4%, Micron was nearly 3% lower, and semiconductor firms Qorvo and Skyworks were down 7% and 6%, respectively.
Traders anticipate that China may make a move against Apple, or promote a boycott of U.S. goods and services.
Asian Market Rally Could Pause While Investors Assess Impact of Hauwei News
Singapore’s OCBC Treasury Research analysts wrote in a morning note, “Asian markets may attempt to build on yesterday’s positive momentum given that China has not announced any further retaliatory measures to US’ Huawei measure beyond verbal protests. However, we read this as a temporary pause to reassess in the interim rather than green light to be risk-on again.”
This article was originally posted on FX Empire
More From FXEMPIRE:
- Gold Price Prediction – Gold Drops as the Dollar Gains Traction
- Stats, the BoC and Geopolitics to Whipsaw the Majors
- DASH Technical Analysis – Support Levels in Play –29/05/19
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Latest Markets Videos
- The 5 Largest Economies In The World And Their Growth In 2020
- From Harvard to Nasdaq Listing: Grab CEO's Ride to World's Biggest SPAC Deal
- CRU-CESCO-Chile´s Antofagasta says surging copper price not enough to entice big investments
- Egypt, Ukraine under review for inclusion in JPMorgan's GBI-EM indexes