Technology companies plummet on Wall Street after Google veto Huawei

Investors fear that the restrictions on the Chinese manufacturer cause a disruption of the supply chain of components

The restrictions imposed by the United States on companies that do business with China’s Huawei are affecting fully the large technology companies specialized in semiconductors, for fear that the confrontation will cause a disruption in the supply chain of telecommunications components. Google’s decision to turn its back on it only increases uncertainty.

Read More Stories: “Boycott Apple” movement threatens Apple’s China business

Trade with China is currently the most important risk for Wall Street and in this context of confrontation, Apple is the company that best reflects the collateral damage of this crossfire. The week has started with a fall of about 3.5% due to the fear of the impact of a boycott of its products. The fall exceeds 10% since the first message with which Donald Trump threatened to escalate the tariff dispute.

Read More Stories: Digital Business: US vs China, smartphone prices go up?

The iPhone manufacturer is especially sensitive, because its growth depends on how sales progress in China. The new tariffs may force you to raise prices to offset the cost. That could reduce the demand for your devices against your competitors. But Apple’s immediate problem is the disruption it can cause in the component supply chain.

Read More Stories: The trade war between China and the US stirs markets in Asia

The blow is being important especially for semiconductor technology specialists. Skyworks drags a 21.5% crash in the last month. The same goes for Xilinx, which is left 17%, and Micron. In the case of Nvidia, it is around 15% and has lost half the value since the annual maximum. A similar trend leads Intel, which depreciated 13% in the month and 26% of the last maximum.

Read More Stories: Apple-Qualcomm: why the two US giants agreed

Among Huawei’s suppliers is Qualcomm, which fell 5% on Monday. The processor manufacturer has just reached an agreement with Apple to put aside the litigation they had about patents and concentrate on the deployment of the new 5G technology. The VanEck Vectors Semiconductor, the indexed benchmark that serves as a reference, is 15% below the annual maximum.

Read More Stories: Beyond Android: this may affect the US blockade of Huawei on their computers


This growing isolation of the Chinese manufacturer is unprecedented. However, the impact is not material for a company like Google. The subsidiary of Alphabet, despite the Android operating system, does not operate in the Chinese market. But the response to the restriction imposed by Washington when doing business with Huawei closes at this time any access option, such as Netflix or Facebook.

Read More Stories: Autosubsync, a tool to synchronize subtitles automatically on Mac and Linux

“We are talking about an impact of billions,” warn the analysts of Evercore, which anticipate a fall in investments if the companies of the sector see that the conflict could affect their businesses, “this is also a question of national security that the US Government needs to consider. ” The restrictions on Huawei were activated under the argument of protecting the communications infrastructure.

Read More Stories: Pokémon Go: Raid week and new monsters

The action against Huawei was adopted a few days after China’s tariffs on imported Chinese goods worth 200 billion dollars rose from 10% to 25%. Donald Trump even threatens to go to total confrontation, applying the tax to all goods that cross the border. In the park they believe that it is a Washington tactic to force Beijing to make concessions.

Read More Stories: OGUsers, the forum of hackers who stole Instagram credentials, hacked by other hackers

Tim Cook, the CEO of Apple, warned two quarters ago that the trade war between the US and China would ballast its business, as has been reflected in the latest results. It is also one of the executives that is most pressing the president of the United States to reach a pact that allows to dispel the uncertainty and prevent the damage to the global economy from accelerating.

Read More Stories: Linux 5.2 Tied: New ARM Driver and Case Insensitivity for Ext4 File System