President Donald Trump said Friday that the United States will cut ties with Chinese telecom giant Huawei, and he is not ready for a trade deal with China.
"We are not going to do business with Huawei … And I really made that decision. It's much easier to not do any business with Huawei … It doesn't mean we won't agree on anything if and when we do a trade, "Trump said.
"We are talking to China; we are not ready to make an agreement, but we will see what happens … China will do something, but I am not doing anything yet. Five years of abuse. I am not ready so fast, "Trump said.
The move to Huawei came after China stopped buying US agricultural products in retaliation for Trump's surprise tariff threat last week. China also dropped its currency against the dollar to an unseen key level since 2008.
Chip shares took a big hit following the news. Micron Technology fell more than 3% on Friday while Advanced Micro Devices traded nearly 2% lower. Skyworks Solutions fell more than 4%. Huawei has been a major customer of these chip manufacturers.
The administration blacklisted Huawei in May for reasons of national security, and prevented it from buying US pieces. But Trump agreed last month to make "timely licensing decisions" to let a number of technology companies including Google and Broadcom sell to the Chinese telecom giant.
Bloomberg News reported earlier Friday that the United States is postponing the granting of licenses to companies to restart sales to Huawei following China's retaliatory measures.
Trump last week abruptly ended the ceasefire with China by announcing 1