In the past five trading days, telecom stocks mostly trended down owing to the continued market uncertainty triggered by trade-related headwinds in the aftermath of China-U.S. row over Huawei. Although the end of the federal government shutdown after a record 35 days seemed to ease the concerns related to the availability of funds for the speedy deployment of 5G technologies, bilateral trade woes with China continued to haunt the sector. This even overshadowed the earnings season, which was quite a dampener compared with the past few quarters.
The U.S. Justice Department has charged two units of China’s Huawei Technologies Co Ltd with a 10-count indictment, accusing them of stealing robotic technology from T-Mobile to test smartphones’ durability. The court has further arraigned Huawei Device Co Ltd and Huawei Device USA Inc on Feb 28 to stand trial for the charges. The latest indictment traces its roots to a civil suit filed by T-Mobile in Seattle District Court in 2014, in which it accused Huawei of stealing trade secrets at the behest of R&D team based in China. Although the case was settled with a $4.8 million compensation award to T-Mobile in 2017, it seems that the Trump administration will leave no stone unturned to ban China’s Huawei and ZTE from the country.