US-China Trade Deal Reveals Key Corporate Winners
$V, $MA, $AXP, $LNG, $JPM, $MS, $TSN
Beef companies, credit card firms and LNG (liquefied natural gas) exporters emerged as potential corporate winners Friday in the wake of trade agreements reached between the United States and China.
Initial reaction on the US stock market was subdued after the announcement late Thursday, part of Washington’s drive to cut its trade deficit with Beijing.
In 1 of the Key actions laid out under the agreement, by 16 July, China agreed to issue guidelines that would allow US-owned card payment services “to begin the licensing process.”
Visa (NYSE:V) shares rose 0.4% while MasterCard (NYSE:MA) edged up 0.1 percent as prospects for global payment network operators at last entering the Chinese market remained uncertain. American Express Co.(NYSE:AXP) shares were down 0.6%.
Foreign-owned firms will also be able to provide credit rating services in China, under the agreement, which are the 1st results of 100 days of trade talks that began last month.
Shares of credit rating agency Moody’s Corp. were off 1%, while S&P Global Inc dropped 0.6%.
The United States also signaled that it was eager to export more LNG, saying China could negotiate any type of contract with U.S. suppliers.
Shares of LNG company Cheniere Energy (NYSE:LNG) were up 4.7%. Cheniere said Friday it has had extensive negotiations with Chinese state-owned companies about increasing US shipments of LNG to China.
Shares of Sempra Energy (NYSE:SRE), a diversified energy company that is building an LNG export terminal, finished up 0.4%.
The agreement also calls for China to issue bond underwriting and settlement licenses to 2 qualified US financial institutions by July 16.
JPMorgan (NYSE:JPM) in February said it would be allowed to underwrite corporate bonds there, while Morgan Stanley (NYSE:MS) was granted permission to boost its stake in a Chinese securities venture to 49%.
The trade deals contained mixed news for US food producers. China will allow US imports of beef no later than 16 July , while the United States will issue a proposed rule to allow Chinese cooked poultry to enter US markets.
Shares of Tyson Foods Inc (NYSE:TSN), which sells both beef and chicken, rose 0.8%, while Pilgrims Pride Corp, the #2 US chicken producer, fell 1.3%
For the full US Commerce Department press release about the initial results of the talks, click here.
Have a terrific weekend.