The United States blacklist has gained eight new Chinese technology companies, added to the list on Monday under the Trump administration. The White House accused these eight tech companies of being implicated in human rights violations against Muslim minorities in China’s far-western province of Xinjiang.
Two of the companies included on the list are Hangzhou Hikvision Digital Technology Co. and Zhejiang Dahua Technology Co. both companies specialize in video surveillance, that control nearly a third of the global market for video surveillance, with their cameras all over the world.
With China’s Vice Premier Liu He scheduled to arrive in Washington for high-stakes trade talks being viewed by financial markets around the world, the timing for these blacklisted companies seem less than ideal.
President Donald Trump has stated “there’s a chance that we could do something very substantial” regarding the scheduled meeting. Furthermore, warning China that if the Nation does anything “bad” to quell protests in Hong Kong, trade negotiations with the United States would suffer.
As a result, Wall Street closed in the red, as optimism of an abrupt trade war resolution faded. On Tuesday, a Chinese newspaper reported that China has toned down it’s expectations ahead of the new negotiations meeting scheduled to start Thursday in Washington. Stating that Vice Premier Liu He will not carry a “special envoy” title, signalling low commitment.
Investors are also awaiting possible Chinese retaliation following the additions to the blacklist on Monday. From a macro perspective, U.S. producer pricing saw the largest decline in eight months this September. Creating more room for monetary easing.
As a result, trade tensions and on going weak global demand took its toll on U.S. stock process.
- Dow Jones: 313-point loss or 1.2%
- S&P 500: 46-point loss or 1.6%
- Nasdaq: 133-point loss or 1.7%
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