US stocks slid on Monday as the White House’s restrictions on Chinese telecoms equipment maker Huawei Technologies weighed on the technology sector and raised concerns that the move would further inflame trade tensions between the United States and China. Since the White House added Huawei to a trade blacklist last week, several companies have suspended business with the world’s largest telecoms equipment maker. Alphabet Inc’s Google has moved to stop providing Huawei with access to its proprietary apps and services. Mobile phone parts producer Lumentum Holdings also announced that it has discontinued shipments to Huawei. Other chip makers, including Intel, Qualcomm, Xilinx and Broadcom, will not supply the Chinese company until further notice, according to a Bloomberg report. Top US tech firms begin to cut off Huawei supplies S&P 500 technology stocks dropped 1.75 per cent, the largest percentage decline among the benchmark index’s 11 major sectors. The Philadelphia Semiconductor Index, which includes Huawei suppliers Qualcomm, Broadcom and Micron Technology, tumbled 4 per cent to hit its lowest level in more than two months. Shares of Apple slumped 3.1 per cent, making them the biggest drag on Wall Street’s major indices. The iPhone maker’s shares were also pressured after HSBC warned that higher prices for the company’s products following the latest increases in tariffs could have “dire consequences” on demand. “The political risk now has become a business risk,” said Chad Morganlander, senior portfolio manager at Washington Crossing Advisers. “This could affect in a meaningful way earnings expectations for many tech names.” The Dow Jones Industrial Average fell 84.1 points, or 0.33 per cent, to 25,679.9, the S&P 500 lost 19.3 points, or 0.67 per cent, to 2,840.23, and the Nasdaq Composite dropped 113.91 points, or 1.46 per cent, to 7,702.38. After touching record highs at the beginning of May, Wall Street’s main indices have succumbed to selling pressure on mounting concerns about a prolonged US-China trade war. The S&P 500 is on track to post its worst monthly decline since the December sell-off, trading nearly 4 per cent below its all-time high. “The further the trade war goes, the more escalation keeps happening,” said Matt Watson, portfolio manager at James Investment Research. “We’re not going in and trying to do a lot of buying at this point.”
