Telecom Stock Roundup: BlackBerry-WM Motor Partnership, Ericsson's 5G Ferry & More
Zacks Investment Research | Dec 11, 2019 09:12PM ET
In the past five trading days, telecom stocks’ losing streak persisted with no tangible breakthrough in trade negotiations regarding the “Phase One” deal between the United States and China. As the clock ticks for the imposition of a fresh round of U.S. tariffs on Dec 15 on $156 billion of imports from China, both sides are keen to seek an early resolution due to domestic compulsions. However, conflicting signals from the top echelons have dampened the prospects of a smooth sail and dragged the sector down.
It seems that the Sino-U.S. trade negotiations will go down to the wire with both countries aiming to bargain hard. While President Trump is seeking a pledge from the communist nation for $50 billion worth of annual purchase of U.S. farm products such as soybeans and pork, China is reportedly dragging its feet for the removal of existing tariffs. Moreover, the $50 billion target is considered to be too high as China bought $20 billion worth of agricultural goods in 2018 before the trade spat broke out.
Meanwhile, contradictory statements from the White House have kept the issue on the potboiler. While acting White House chief of staff Mick Mulvaney expressed solidarity for the resolution of the partial trade accord, the top economic adviser to the President – Larry Kudlow – hinted that the Dec 15 tariffs were “still on the table.”
Further stirring the hornet’s nest, Beijing has sought to remove all foreign hardware and software from their systems in three years in a retaliatory measure against the alleged unilateral trade sanctions against Huawei and ZTE (HK:0763). Set on a “3-5-2” basis, the policy aims to rip and replace 30% of foreign hardware and software in 2020, 50% in 2021 and the remaining 20% in 2022. This, in turn, is likely to affect the top line of leading U.S. technology firms and potentially disrupt their supply chain mechanism. However, U.S. lawmakers have refused to back down from the risk of blowback for American firms and pledged to take effective measures to preempt alleged spying and siphoning of data by China-based telecom firms.
Regarding company-specific news, strategic collaboration, 5G-enabled automated service, AI-powered facial recognition, acquisition and edge computing took the center stage over the past five trading days.
Recap of the Week’s Most Important Stories
1. BlackBerry Limited (NYSE:BB) has collaborated with China-based electric vehicle manufacturer WM Motor to augment the in-car experience of the latter.
Per the alliance, BlackBerry QNX technology, including QNX Platform for Digital Cockpits and QNX Hypervisor for Safety, will be used in the forthcoming production run of WM Motor third-generation SUVs. This is likely to ensure co-existence of multiple operating system on the same SoC to optimize performance, increase system reliability and enable safety compliance mechanism. (Read more: Zacks Investment Research
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.