No end in sight for the U.S.-China trade war means volatility for the markets. Tech stocks are leading the way down…
Qualcomm QCOM 114.50 +2.31 +2.06% continues to fall, nothing new has come out since yesterday but it seems the market is starting to digest all this information. They were suffering from the Huawei blacklist to begin with, then a judge ruling with the FTC sent the stock price significantly lower. They’re down 3.5% today after closing down over 10% yesterday.
Apple AAPL 130.89 +2.09 +1.62% had it’s price target cut from $235 to $225 by UBS. This is still a 25% rise from today’s stock price.
“UBS Evidence Lab’s 10th Global Smartphone Survey indicates more lengthening of smartphone upgrade cycles, especially in the US and UK. For iPhone, purchase intention appears to be stabilizing though at a low level in all regions, except China. Survey indicates a 6pt drop in China from Oct. and 5pts from a year ago and at the lowest level ever. We cut our iPhone forecasts to reflect the smartphone softness and see risk of potential demand destruction in China from backlash given Huawei situation. The survey indicates mix of iPhones at the high-end ($999+) improved two points YoY. ASP mix benefit would likely be offset by price discounts. China remains a risk but is likely in investor expectations and the focus would shift to new services. We lower our F20 EPS estimate 3% and price target from $235 to $225 but maintain our Buy rating as iPhone expectations are very low for this Fall and we think investors may look through near-term softness ahead of 5G upgrade next year.”
Pretty lofty expectations in a very uncertain market.
More Bad News for Huawei
UK and Japan are joining the Banwagon. EE and Vodaphone, two of Britain’s largest telecom companies have dropped Huawei devices from their 5G launch plans.
SoftBank and KDDI, two of Japan’s largest mobile phone carriers, said they would delay the launch of Huawei’s new smartphone. This will affect the Huawei P30 Lite smartphone, due to go on sale Friday. Japan’s largest carrier, NTT DoCoMo, said it was considering putting reservations for the Huawei P30 Pro smartphone.