Nikkei dips as Huawei fallout hits suppliers; Softbank soars

  • Reuters
  • Stock Market News
Nikkei dips as Huawei fallout hits suppliers; Softbank soars
Credit: © Reuters.

* Murata, TDK, Taiyo Yuden, Tokyo Electron, TDK underperform

* SoftBank jumps after T-Mobile deal for Sprint gets boost from FCC

By Ayai Tomisawa

TOKYO, May 21 (Reuters) - Japan's Nikkei slipped on Tuesday as Washington's blacklisting of Huawei took a heavy toll on suppliers to the Chinese telecoms equipment maker, but the downside was limited after the United States temporarily eased trade restrictions.

The Nikkei .N225 ended 0.1% lower at 21,272.45. It briefly turned positive after news the U.S. government had temporarily eased trade restrictions imposed last week on China's Huawei Technologies Co Ltd HWT.UL . the White House added Huawei to a trade blacklist last week, several global companies have suspended business with the world's largest telecoms equipment maker.

"We are worried that the move by the U.S. would lead to a further deterioration of trade tensions between the United States and China. If the trade worries drag on, Japanese companies' earnings in the second half will also likely be hit," said Nobuhiko Kuramochi, a strategist at Mizuho Securities.

The electric machinery sector .IELEC.T tumbled 1%, underperforming the overall market. Murata Manufacturing 6981.T shed 1.5%, TDK Corp 6762.T declined 0.9%, while Tokyo Electron 8035.T slumped 1.9%, Taiyo Yuden 6976.T slid 0.6% and Hitachi High-Technologies 8036.T dropped 1.7%.

Mizuho Securities estimates that sales to Huawei account for about 6-8% at these suppliers.

Other cyclical stocks also lost ground, with shippers Mitsui OSK Lines 9104.T down sharply by 4% and Kawasaki Kisen 9107.T also stumbling 4.1%.

SoftBank Group Corp 9984.T , which has a stake in Sprint Corp S.N , soared 3.5% after news that T-Mobile US Inc's TMUS.O $26 billion acquisition of rival Sprint appeared to win the support of a majority of the Federal Communications Commission on Monday. sensitive stocks outperformed as investors stayed defensive. Realtor Mitsui Fudosan 8801.T rose 1.7%, while drugmaker Daiichi Sankyo 4568.T gained 1.2%.

The broader Topix .TOPX dropped 0.3% to 1,550.30. Declining issues outnumbered advancing ones 1,320 to 743. (Editing by Jacqueline Wong)

Drop an image here or Supported formats: *.jpg, *.png, *.gif up to 5mb

Error: File type not supported

Drop an image here or


Related Articles