Stocks: Huawei U.S. Suppliers Shares Drops During Thursday Trade
May 17, 2019 | Friday
Huawei's U.S. listed suppliers shares slipped during Thursday trade. That mostly led by a new rule requiring American firms with a government approved license before selling products to the Chinese tech giant.
This week, Huawei includes within the United States Bureau of Industry and Security's Entity List. That means American companies are now required to have a license approved by the government before doing business with Huawei Technologies.
The Chinese tech giant has more than 30 U.S. companies it considers as it's "core suppliers." These companies sell components which include in Huawei's telecom networking equipment.
A lot of these firms are publicly listed and did take hard blows as Thursday trade session ends. Micron down by about 3 percent, Qualcomm down by 4 percent, and semiconductor companies Skyworks and Qorvo also down by 6 percent and 7 percent, respectively.
The Chinese tech expected such an outline saying U.S. government action may hurt such firms.
On Friday, Huawei's spokesperson said that the settlement is "no one's interest." It only provides "significant economic harm" to numbers of American companies that do business with Huawei. The settlement impacted "tens of thousands" jobs within American firms, disrupting the "collaboration and mutual trust" within the global supply chain. As of now, the Chinese tech giant seeks solutions and resolution on the matter.
The Chinese tech giant seemed prepared in such a situation. Six months ago, Huawei said to a few suppliers its idea to build a year's worth of crucial components. According to Nikkei Asian Review on Friday report, it prepares for the U.S.-China trade dispute issues.
For the past few years, Huawei is trying to lessen its dependence on U.S. firms by investing within its own chip technology needed for its consumer products, mostly for 5G chips and smartphone processors.
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