The major Asian stock indexes are trading lower on Tuesday. Amid renewed US-China tensions. Concerns are being raised after the U.S. Department filed criminal charges on Monday. to officially request the extradition of Meng Wanzhou. The chief financial officer of Chinese telecommunications giant Huawei. Fresh concerns over China’s economy were also at the forefront on Monday. following a sharp break in U.S. equity markets. after bellwether companies Caterpillar and Nvidia issued weak guidance.
At 0345 GMT, China’s Shanghai Index is trading 2583.94, down 13.04 or -0.50%. Hong Kong’s Hang Seng is at 27437.94. Down 139.02 or -0.50% and South Korea’s KOSPI Index. is at 2170.28, down 7.02 or -0.32%.
In Japan, the NIKKEI Index is at 20448.47, down 200.53 or -0.97% and Australia’s ASX 200 Index is at 5877.40, down 28.20 or -0.48%.
U.S. Department of Justice Seeks Extradition of Huawei CFO
The Justice Department filed criminal charges. on Monday to officially request the extradition of Meng Wanzhou. The CFO of Chinese telecommunications giant Huawei. The Justice Department also announced charges against Huawei. for allegedly stealing trade secrets from T-Mobile.
“Huawei and its senior executives repeatedly refused to respect U.S. law. said FBI Director Christopher Wray. In Monday’s press conference. “Huawei … systematically sought to steal valuable trade secrets.”
Stock investors are particularly disturbed by the timing of the charges. since they come right before the start of crucial high level trade talks. between the United States and China in Washington on January 30-31. Although experts don’t believe that this incident can be tied. directly to trade negotiations since the investigation likely began. long before the start of the trade dispute.
New Concerns Over China’s Economy
Last week, traders showed a muted reaction to the weaker Chinese GDP numbers. and the International Monetary Fund’s (IMF). warning about the slowing global economy. However, the weakness in China’s economy finally hit home. on Monday when Caterpillar reported weaker-than-expected. earnings for the fourth quarter. The bellwether company cited lower demand in China. for its decline in sales in the Asia/Pacific region.
Meanwhile, chipmaker Nvidia. slashed its fourth-quarter revenue guidance to $2.2 billion from $2.7 billion. It said in its report that “deteriorating macroeconomic conditions. Particularly in China,” impacted demand for its graphics processing units.
The decline in Nvidia also spread to other chipmakers. Advanced Micro Devices dropped 8 percent while Micron slipped 2.3 percent. The VanEck Vectors Semiconductor ETF (SMH) dropped nearly 2 percent.