Published: Fri, August 09, 2019
Markets | By Otis Pena

Gains for Asian shares capped by fresh trade jitters, China stocks fall

Gains for Asian shares capped by fresh trade jitters, China stocks fall

Speaking to reporters at the White House before departing for fundraisers in NY state, Trump also said the United States would continue to refrain from doing business with Chinese telecoms equipment giant Huawei Technologies.

The White House is reportedly holding off on a decision about licenses for USA companies to restart business with Huawei Technologies.

Beijing has yet to place any restrictions on its rare earth supplies to the U.S. Huawei suppliers Micron Technology Inc. and Western Digital Corp. declined as much as 2.2 percent after news of the delay in license approvals. The Association of China Rare Earth Industry issued a statement after a special working meeting on Monday to discuss the "guidance" given by Chinese President Xi Jinping during a visit to a rare earth plant in Jiangxi in May. However, that promise was contingent upon China beefing up its purchases from American farmers, which Trump has complained the nation has failed to do.

In the past week tensions have escalated further as Trump said he would impose a 10 percent tariff on $300 billion of Chinese imports as of September 1, and his Treasury Department formally labeled China a currency manipulator. He said the problem of Huawei isn't associated with the commerce talks.

Asia ex-Japan.MIAPJ0000PUS had ended down 2.3% for the week after data showed China's first decline in producer prices in three years, compounding the Huawei disappointment.

American technology companies that hoped to soon resume their sales to Huawei might have to wait a little longer.

Commerce Secretary Wilbur Ross, whose department has vetted the purposes to renew sales, stated last week he's acquired 50 requests and that a call on them was pending.

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Chief executives from chipmakers including Intel, Qualcomm and Broadcom had all reportedly met with Donald Trump in July, while still others such as Xilinx or Broadcom had openly argued that any ban would be pointless because the Chinese firm could source semiconductors from other makers overseas.

Background: The U.S. Commerce Department placed Huawei on its Entity List in May, effectively blocking U.S. exporters from selling equipment to the company without obtaining a license.

Chinese and USA flags flutter near The Bund, before US trade delegation meet their Chinese counterparts for talks in Shanghai, China [Photo, AFP] China's rare earths association said it would support Chinese counter-measures in the escalating trade row with the United States, which it accused on Wednesday of "bullying". "China trade dispute remains a risk, and this risk is not receding".

China's exports unexpectedly rose in July, growing 3.3% from a year earlier, customs data showed on Thursday, despite mounting USA trade pressure.

Based on these rates, USA customs agents will begin collecting duties from importers.

The Chinese telecom giant has become a bargaining chip in the US-China trade war.

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