Stock market news: Global stocks slide on Huawei US probe

Global stock markets were sliding Thursday as fears about a fresh deterioration in US-China relations spooked investors and sparked selling across the world.

By about 8:50 a.m. GMT (3:50 a.m. ET), major exchanges in Europe were losing about 0.5%, and Chinese stocks slid by 0.9% or less.

The moves lower appeared to be driven by fears about relations between Beijing and Washington after reports indicated that federal prosecutors were investigating the Chinese smartphone giant Huawei over suspicions it had stolen trade secrets from US tech companies.

“It goes right to the heart of the unresolved IP issues with China,” Jasper Lawler, the head of research at London Capital Group, wrote. “China are unlikely to shrug this off which is creating a risk-off environment. Signs of retaliation from China could see stocks sink further.”

One aspect of the criminal investigation involves allegations that Huawei stole robotic technology used for testing smartphones from a T-Mobile facility in Washington, according to a Wall Street Journal report.

A group of US lawmakers also put forward bills Wednesday that would ban the sale of US chips and components to the Chinese giant.

In December, Huawei’s chief financial officer was arrested during a stopover in Canada on allegations of violating trade sanctions with Iran.

Read more:A drastic plunge in shipping to China is the latest horrible signal for its economy

Here’s how things looked about an hour after the start of European trade Thursday:

  • Asian stocks were mixed, though most major indexes lost ground following reports about Huawei. China’s biggest loser was the Shenzhen Composite, which fell 0.9%. The benchmark Shanghai Composite was down 0.4%.
  • Outside mainland China, Japan’s Nikkei dropped 0.2%, while the Hang Seng in Hong Kong was 0.5% down. Shares in South Korea, New Zealand, and Australia ended the day with small gains.
  • Major European share indexes were lower, but not hugely so, with Germany’s DAX the biggest loser, down about 0.5%. The Euro Stoxx 50 broad index dropped 0.3%.
  • US futures pointed to a similar story across the pond, with the Nasdaq set to see the largest fall, down 0.5%. The Dow Jones Industrial Average was set to open 0.4% down, while the S&P 500 was set to shed 0.4%.

Source link Business News Australia

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