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Asian Tech Stocks Smoked Amid Fresh Escalations In Simmering Trump-China Feud

All of this is going to inflame trade tensions.

Needless to say, allegations of high-stakes hacking and a bevy of absurd accusations from Mike Pence served to materially dent sentiment in Asian technology shares on Friday.

Bloomberg’s blockbuster “tiny spy chip” exposé and Pence’s contention that China is meddling in U.S. elections exacerbated tensions between Washington and Beijing at the worst possible time.

“There can be no doubt [that] China is meddling in America’s democracy”, Pence said, during a speech at the Hudson Institute in Washington.

For their part, Chinese officials called Pence’s allegations “ridiculous” on the way to advising Washington to avoid spreading “malicious slander.”

To that, we would say: “Welcome to every American’s hell, China.” U.S. citizens wake up every morning to a deluge of “ridiculous, malicious slander” emanating from the Presidential Twitter feed.

Anyway, Asian tech was crushed on Friday. The MSCI AC Asia Pacific Infotech Index, for instance, hit its lowest levels since July 2017.

MSCIAsiaPacInfo

(Bloomberg)

Lenovo tried to remind markets that Super Micro – the company at the center of the Bloomberg investigative piece –  “is not a supplier in any capacity”, but it didn’t matter. The company’s shares plunged, falling the most since 2009 at one juncture before trimming losses to “just” 15%:

Lenovo

JPMorgan didn’t help. According to a trading note mailed around to clients, the bank recommended shorting the shares based on the assumption that the U.S. is bound to import fewer servers, at least in the near term following the exposé.

Shares in Taiwan tumbled nearly 2%, to their lowest since May:

Taiwan

It goes without saying that things are going to get interesting when China reopens. All of this is going to inflame trade tensions and will likely serve to undercut any  backchanneling that might have been going on to defuse things.


 

 

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2 comments on “Asian Tech Stocks Smoked Amid Fresh Escalations In Simmering Trump-China Feud

  1. Pingback: Jobs Report, Tech Woes And Curve Steepeners: Thoughts On Friday - Get the latest financial news. Free real time quotes, 25 Trading Tools, Technical analysis, and much more.

  2. Pingback: Jobs Report, Tech Woes, And Curve Steepeners: Thoughts On Friday – ResumeLord

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