Influence of US-China Tariff Struggle on Inventory Costs in Europe and Korea: A Comparative Evaluation

Because the ‘tariff struggle’ between the US and China reveals indicators of spreading to Europe, the inventory costs of associated shares are fluctuating. In the meantime, the inventory costs of solar energy corporations and power storage system (ESS)-related corporations in Korea and america, which have been affected by oversupply from China, have risen, whereas the inventory costs of automotive corporations European, which dangers shedding market share within the Chinese language market, has fallen.

○ US-EU ‘anti-China alliance’, solar energy plant ‘mugwort’

twenty third Hyundai HD Vitality ResolutionThe transaction ended at 31,650 gained, as much as the silver worth restrict (29.98%). This firm has recorded the best worth restrict for about 3 years and eight months since September 4, 2020. On at the present time Hanwha Solutions It additionally closed with a surge of 11.98%.

This seems to be an impact when america encourages the European Union (EU) to reply collectively to low-priced exports from China. The EU depends on imports for 97% of its photo voltaic panels, most of that are made cheaply in China. In a speech on the Frankfurt Faculty of Finance and Administration in Germany on the twenty first, US Secretary of State Janet Yellen stated, “If we don’t reply to China’s industrial coverage in a unified approach, the survival of world corporations will probably be in danger. ” In actual fact, it’s aimed toward Chinese language photo voltaic power corporations.

The US authorities beforehand introduced on the 14th that it will enhance tariff charges in response to China’s unfair commerce. Tariff charges on medical provides and semiconductor objects, together with batteries and supplies/components (7.5% → 25%), electrical automobiles (25% → 100%), and photo voltaic cells (25% → 50%) have been considerably elevated. The European Fee is investigating unfair subsidies for Chinese language photo voltaic panels and electrical automobiles. Preliminary measures for electrical automobiles are anticipated to return out in early July.

As america and Europe react collectively to Chinese language exports, the inventory costs of associated shares fluctuate. Within the final month, Hanwha Options has elevated by 31.3%, OCI holdingshas risen by round 7.1%. ESS-related shares have additionally emerged as beneficiaries of sanctions on Chinese language batteries. SK Eternixis 22.4% for one month, Seojin systemrose 31.4%. Hyundai Motor Firm’s inventory worth jumped 9.4% the day past as Hyundai Motor Firm was additionally anticipated to learn from sanctions in opposition to China’s electrical automobiles.

Park Geon-young, a researcher at Kyobo Securities, stated, “If Chinese language stock in america is depleted within the second half of this 12 months and worth competitors slows down, we will count on a restoration within the efficiency of home photo voltaic power corporations.” Cho Hyun-ryeol, a researcher at Samsung Securities, stated, “If tariffs are imposed on Chinese language batteries utilized in ESS, Korean battery corporations will profit.”

○ International shares additionally fell sharply because of the tariff struggle.

International inventory markets are additionally shaking due to the US-China commerce struggle. Consultant of American photo voltaic power corporations First Photo voltaic and Sunrun rose 18.6% and seven.9%, respectively, the day past. From final month, it jumped 39.7% and 25.8%. Medical gear corporations Mvekta and Prime Glove additionally rose 24.7% and 42.3% throughout the identical interval. Mvekta is an organization that produces diabetes medical units equivalent to insulin syringes, and Prime Glove is an organization that produces surgical gloves.

Then again, European automakers are going through a counterattack from Chinese language authorities. BMW and Mercedes-Benz fell 9.7% and 5.2% from the 14th to the day past. There may be hypothesis that China will impose tariffs of as much as 25% on giant vehicles imported from the US and Europe in retaliation for the rise in tariffs on electrical automobiles.

Lim Eun-young, a researcher at Samsung Securities, stated, “Within the Chinese language market, international automakers’ gross sales are falling attributable to being pushed out by native electrical automobiles in China.” Hyundai MotorsHe stated, “Since Kia and Kia account for under a small portion of their gross sales in China, they are going to profit from the battle between the US and China.”

Correspondent Taewoong Bae btu104@hankyung.com