Semiconductor Manufacturing International Corporation (SMIC) is China’s largest chip manufacturer. Hong Kong-listed shares of SMIC fell 22.88% on Monday. It is worth mentioning that, SMIC is regarded as an important player in China’s ambition to grow its domestic semiconductor industry.
Interestingly, the Hang Seng Tech index fell 4.57% on the day to 7’240.96. Notably, the index fell after a U.S. Defense Department spokesperson made an important comment.
According to a spokesperson, Donald Trump’s administration could impose export restrictions on China’s largest chip manufacturer. The potential move would mark a major escalation in the tech battle between the U.S. and China. Tensions between the largest economies in the world started a long time ago. In January of this year, the U.S. and China signed a partial trade agreement.
Nevertheless, the relations between the countries are far from being ideal, but the coronavirus pandemic created even bigger issues. Investors are closely monitoring the situation to learn more about the ongoing situation. Unfortunately, it won’t be easy to solve all problems as some of them are quite old.
Tensions between China-U.S. and stocks 
Importantly, mainland Chinese stocks led losses among the region’s major markets on the day. The Shanghai Composite fell 1.87% to about 3’292.59. At the same time, the Shenzhen Composite dropped 2’729% to around 13’284.03.
Hong Kong’s Hang Seng index fell 0.43% to 24’589.65.
In Japan, the Nikkei 225 dropped 0.5% to 23’089.95. In the meantime, the Topix index fell 0.42% to end its trading day at 1’609.74.
Interestingly, South Korea’s Kospi index defied the trend, with the Kospi gaining 0.67% to close at 2’384.22.
Australia’s S&P/ASX 200 added 0.33% to 5’944.80.
As can be seen from the information stated above, stocks were mixed on Monday, as investors reacted to rising tensions between the economic superpowers. It is not surprising as tensions between the U.S. and China represent a serious issue.
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