Asian markets mixed as Huawei report offsets US earnings

January 17, 2019: Asian markets were mixed on Thursday as renewed concerns about China-US tensions overshadowed a positive lead from Wall Street following a better-than-expected round of corporate earnings.

The pound extended gains against the dollar after Prime Minister Theresa May survived a no-confidence vote as she prepares to draw up new proposals to leave the European Union that is palatable to a majority of MPs.

After a tumultuous December, global equities have enjoyed a broadly strong start to the year, largely thanks optimism China and the US will resolve their trade row.

But confidence took a knock Wednesday from a report that said US officials were carrying out a criminal probe into Chinese tech giant Huawei and could soon indict the firm over allegations of theft of trade secrets from its US business partners.

Lawmakers have also introduced a bill to ban the export of American parts and components to Chinese telecom companies that are in violation of US export control or sanctions laws — with Huawei and fellow Chinese firm ZTE the likely targets.

“Huawei is effectively an intelligence-gathering arm of the Chinese Communist Party whose founder and CEO was an engineer for the People's Liberation Army,” said Republican Senator Tom Cotton, one of the bill's sponsors.

The developments follow the arrest last year in Canada of Huawei's chief financial officer Meng Wanzhou, who is the daughter of the company founder and faces extradition to the US on Iran-linked fraud charges.

It also muddies the waters in trade talks between Beijing and Washington, which looked to be on a positive course after officials held three days of talks earlier this month, with both sides seemingly upbeat.

(APP)

Posted on: 2019-01-17T10:18:00+05:00

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