Chinese household appliances and solar stocks spooked by Trump tariffs reverse some losses
But uncertainty ahead as markets await outcome of intellectual property theft probe
Chinese household appliances and solar related stocks reversed some of the losses incurred on Tuesday morning, after US President Donald Trump slapped steep tariffs on imported washing machines and solar panels on Monday, by close of trade.
An analysts said the new tariffs might actually benefit Chinese companies by winning them foreign rivals’ market share in the United States.
South Korea and Mexico export the bulk of washers to the US, with much of the production coming under the umbrellas of South Korean giants Samsung Electronics and LG Electronics.
“Given leading Chinese companies’ competitiveness in these industries, they are set to benefit from the tariff by winning over some US market shares from foreign rivals,” said Wei Wei, a trader at Huaxi Securities in Shanghai. “And the domestic market accounts for the lion’s share of their revenue.”
Washing machine maker Wuxi Little Swan fell by as much as 1.6 per cent before paring losses to 0.6 per cent, to close at 74.19 yuan (US$11.58) in Shenzhen. The company derived 70 per cent of its sales in 2016 from China, according to data compiled by Bloomberg.