The Trump administration created a list of companies and affiliates that they consider to be threats to their country’s national security and Huawei was one of them. The ban came into effect last May 17, and Huawei lost the support of some United States-based businesses like Google. China and the United States are currently on the verge of a trade war, and other Asian countries are affected. You may need your investment portfolio manager company like Landmark Financial to review on your investment portfolio.
There’s a current debate on what will happen to the 70 billion USD global markets for the Huawei components. Taro Aso, Japan’s Finance Minister said that the United States’ decision against Huawei could also impact Japan’s economy. There are Japanese companies that supply components and the supply chains could affect each other.
China-U.S. Trade War Effect on Stocks
Huawei is currently the largest telecommunications equipment supplier, reporting 105 billion USD in revenue last year. There are over 24 Asian components suppliers for their products, and 11 of those are Japan-based companies. While financial companies in Tokyo like Landmark Financial are still unaffected by the news, it’s only a matter of time before the trade war takes prisoners.
If you currently have investments, you should expect some dramatic changes on your telecommunications stocks. Portfolio management companies like Landmark Financial review the changes to every stock so it’s important to have a stop-loss order in play, just in case something goes south.
Japanese Stocks
According to the Tokyo Stock Exchange, stocks like Nikkei lost ground due to the Huawei-United States tension. Nikkei fell 0.62 percent or 132.23 points then ended up at 151.14. On Wednesday, Nikkei recovered 10.92 points. Brokers say that Nikkei is expected to have more drops as the tension between China and the United States drag on.
Topix index also finished 0.36 percent or 5.63 points down, after they lost 4.09 the day before. It dropped for three days straight. The trade issues were caused by media reports that the United States is going to impose trade ban more Chinese companies such as Hangzhou Hikvision Digital Technology, a major maker of surveillance equipment.
While the market is slowly trying to stabilize, Nikkei and Topix are still in the red. The stocks were said to have recovered due to the news that the President Trump of the United States and President Xi Jinping of China were going to have a bilateral meeting during the Group of 20 summit to be held in Osaka from June 28 to 29.
Companies like Taisei, SoftBank Group, Mitsui Mining & Smelting, and Shimizu also lost points amidst the on-going trade tension. Meanwhile, Fancl, cosmetics maker, and Maruha Nichiro, seafood producer, were spared from the stock drops.
Final Thoughts
You may want Landmark Financial review on your portfolio to see if your Japanese stocks are unaffected by the China- U.S. tension. While things are currently stable for some of the Asian companies, Huawei’s demise might still have an impact on other telecommunication companies, whether good or bad.
