PVH, Illumina shares slide after China targets companies (updated)

PVH

04/02/2025 15:08

(Updates prices to market open, adds PVH response in paragraph
4, analyst comment in paragraph 6)
    By Mariam Sunny
       Feb 4 (Reuters) - Shares of Calvin Klein-owner PVH Corp
 PVH.N  and genetic testing company Illumina  ILMN.O  fell on
Tuesday after China placed the two companies on its "unreliable
entity" list, putting them at risk of sanctions.
    Companies added to the blacklist can be subject to fines and
a broad range of other sanctions, including a freeze on trade
and a revocation of work permits for foreign staff.
        Illumina's shares slipped 2.5% to $3.35, while PVH's
stock dropped 3.1% to $80.72 in morning trading.
  
    PVH, which has already been under scrutiny from Chinese
regulators over "improper" conduct related to the Xinjiang
region, said the company would continue engaging with relevant
authorities to work towards a resolution. 
    For Illumina, China accounts for about 7% of sales. Two of
its Chinese rivals, MGI and BGI, were listed in a U.S. bill that
aims to restrict business with several biotech companies on
grounds of national security.
        The inclusion in the list "appears more permanent
posturing by China vs retaliatory tariffs, which can be removed
or dialed back depending on how the negotiation progresses
between the U.S. and China", said Leerink Partners analyst
Puneet Souda.
  
        China's limited response came just after U.S. President
Donald Trump's sweeping tariffs took effect, underscoring
attempts by its policymakers to engage Trump in talks to avert
an outright trade war.
  
    China also said it was investigating Alphabet  GOOGL.O ,
although it did not provide details on the investigation or what
it alleged Google had done to breach the law.
    Alphabet's shares, however, were unaffected, rising 1.1%.
Some of the company's key products, including its Google search
engine, are already blocked in China and its revenue from the
country represents only about 1% of its global sales. 
    Shares of Intel  INTC.O  fell 1% after the Financial Times
reported that Chinese regulators were also looking to launch a
formal probe into the chipmaker.

 (Reporting by Mariam Sunny and Lisa Pauline Mattackal in
Bengaluru; Editing by Pooja Desai)
 ((Mariam.ESunny@thomsonreuters.com;))