HK-listed textiles, footwear makers drop on Trump's reciprocal tariffs

Shenzhou International group

03/04/2025 04:05

** Shares of knitwear products maker Shenzhou International 2313.HK plunge as much as 17.5% to HK$51, lowest since July 2017

** Stock set for the biggest one-day pct drop since October 2008, top pct loser on Hang Seng Index .HSI, which falls 1.8%

** Footwear maker Yue Yuen Industrial 0551.HK drop nearly 7% to HK$11.78, lowest since August 7, 2024

** President Donald Trump on Wednesday unveiled a 10% minimum tariff on most goods imported to the United States, and higher duties on dozens of other countries

** "Our initial take is severe margin and ASP pressure by the OEMs in the next 3-5 years," Jefferies says in a note, adding textile and footwear OEMs' nightmare comes true as U.S. government announced reciprocal tariff on major textile and footwear-making nations

** Jefferies says Shenzhou's downside risks include price erosion, operating deleverage and volatility in raw material prices

** Adds, Yue Yuen, which has market exposure to the U.S., EU and China, may face slower long-term growth in the U.S. and EU sportswear markets vs the Chinese market

** Shares of power tools manufacturer Techtronic 0669.HK  slides 9.7% to HK$84.7, lowest since March 4, 2024

 (Reporting by Donny Kwok)

 ((donny.kwok@thomsonreuters.com))