Shares stateside slipped last Friday on the back of reports that trade negotiations between the U.S. and China have hit a pause. Sources told CNBC that scheduling discussions for further trade talks have been put on hold since U.S. President Donald Trump‘s administration has increased scrutiny of Chinese telecom companies. A U.S. delegation had earlier been invested to Beijing.
“My read on the situation is that the two parties are … quite a long way apart at this point,” Mark Jolley, global strategist at CCB International Securities, told CNBC’s “Squawk Box” on Monday. “They’ve been negotiating for quite a long period of time now and … it appears that we haven’t made too much progress.”
Huawei Technologies will immediately lose access to updates to the Android operating system, and the next version of its smartphones outside of China will also lose access to popular applications and services including the Google Play Store and Gmail app, according to the Reuters report.
Last week, the administration made it harder for U.S. companies to do business with Huawei, a giant telecommunications company in China. U.S. firms that want to do business with Huawei must now have a license.
“Huawei has 12 months worth of chips already lined up … in reserve, in stock that it can use. And so, that gives it plenty of time to reengineer its supply chain and so, actually what this is doing it potentially … it’s putting American suppliers really under pressure rather than anyone else,” Paul Gambles, co-founder and managing partner of MBMG Group, told CNCB’s “Street Signs” on Monday.
The Japanese yen, widely seen as a safe-haven currency, traded at 110.20 against the dollar after seeing levels below 109.2 last week. The offshore Chinese yuan traded at 6.9337 against the greenback after falling to an earlier low of 6.9480. It’s onshore counterpart traded at 6.9070.
Oil prices gained in the afternoon of Asian trading hours, with the international benchmark Brent crude futures contract adding 1.43% to $73.24 per barrel. The U.S. crude futures contract also gained 1.37% to $63.62 per barrel.