Asian Markets Mostly Up But Huawei, Trade War Loom Large

Asian markets mostly rose Tuesday but concerns about the Huawei row and broader China-US trade war kept investors on edge, with analysts warning the crisis could rumble on for some time

Hong Kong, (UrduPoint / Pakistan Point News - 21st May, 2019 ):Asian markets mostly rose Tuesday but concerns about the Huawei row and broader China-US trade war kept investors on edge, with analysts warning the crisis could rumble on for some time.

Regional investors were spooked by a sharp drop in New York's tech-rich Nasdaq after Google said it was beginning to sever ties with the Chinese telecoms giant, days after Donald Trump's decision to bar it from the US market and put it on a sales blacklist.

The Huawei development -- with the US citing national security concerns -- has muddied the waters in the tariffs stand-off between Washington and Beijing, which was thought to have been close to conclusion at the start of the month.

And now some observers are warning that stalled talks between the economic superpowers might not see any progress before a hoped-for meeting between Trump and China's Xi Jinping at the G20 in June.

"The market was a little optimistic that a trade deal would just get done here this month," Brett Ewing, chief market strategist at First Franklin Financial Services, told Bloomberg News.

Dealers have "definitely come to terms with a longer term trade negotiation process".

While the Commerce Department issued a 90-day reprieve on the ban on dealing with Huawei, saying breathing space was needed to avoid huge disruption, the two appear to be digging their heels in.

And on Monday China's envoy to the European Union called the Huawei move "wrong behaviour", adding "there will be a necessary response".

Zhang Ming warned: "Chinese companies' legitimate rights and interests are being undermined, so the Chinese government will not sit idly by." The developing crisis had a mixed impact on Asia's tech firms, with Samsung Electronics, a rival to Huawei in the smartphone market, rallying 2.7 percent.

Analysts say the US ban will damage Huawei's ability to sell phones outside China, offering Samsung a chance to consolidate its position at the top of the global market.

But in Tokyo, Sony shed more than four percent and Sharp was off 2.5 percent, while Taiwanese chip giant TSMC shed 1.7 percent.