China Market falls as trade tension lingers

Headline indices of the Mainland China equity market closed down on Wednesday, 22 May 2019, as trade war concerns grow after reports that the Trump administration is considering blacklisting Hikvison - a major Chinese surveillance technology firm. At closing bell, the benchmark Shanghai Composite Index declined 0.49%, or 14.26 points, to 2,891.71. The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 0.51%, or 7.83 points, to 1,540.85. The blue-chip CSI300 index sank 0.47%, or 17.40 points, to 3,649.38.

The U.S. administration is considering limits to Chinese video surveillance firm Hikvision's ability to buy U.S. technology, the New York Times reported on Tuesday, in a move that deepens worries about trade frictions between the world's two top economies. That came after the U.S. Commerce Department blocked Huawei Technologies Co Ltd from buying U.S. goods last week. Shares in state-owned Hikvision plummeted as much as 10% to their lowest since Jan. 4, 2018 after the report.

 

Beijing is ready to resume trade talks with Washington, China's ambassador to the United States Cui Tiankai said, as a top U.S. business lobby in China said nearly half its members are seeing non-tariff barrier retaliation in China due to the trade war.

Nanjing Chervon Auto Precision Technology (603982 SH), a producer of automotive components that traded today for the first time, soared by the maximum 44% to 14.1 yuan from its initial public offering price of 9.79 yuan.

Shares of Qingdao Huicheng Environmental Technology (300779 SZ), a chemical products maker, also surged 44% to 19.57 yuan from its IPO price of 13.59 yuan.

CURRENCY NEWS: China's yuan softened against the U.S. dollar on Wednesday, as China's central bank set weaker midpoint fixing. Prior to market opening on Wednesday, the PBOC set the midpoint rate at 6.8992 per dollar, 2 pips weaker than the previous fix of 6.8990. In the spot market, onshore yuan opened at 6.9060 per dollar and was changing hands at 6.9089 at midday, 61 pips weaker than the previous late session close and 0.14 percent softer than the midpoint.

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