Steve Jobs resignation gets mixed reactions in Asia market trade
The resignation of Steve Jobs as chief executive of Apple Inc. got a mixed reaction in Asia trade Thursday, as shares in Apple's smartphone competitors rose sharply on hopes that a leadership change might distract the U.S. company, while some component suppliers and assemblers fell on concerns about how the management change might affect their long-term business prospects.
Apple competes with the likes of HTC Corp. of Taiwan, Samsung Electronics Co., and LG Electronics Inc. in the highly competitive smartphone industry.
But Samsung also supplies key components such as chips and displays that go into Apple's devices and the company's component business relies heavily on Apple's business.
Meanwhile, LG Electronics unit, LG Display Co., also supplies displays used in Apple's popular iPad tablet computer. HTC shares were recently up 2.4% at NT$758.00, boosted by the news, while Samsung rose 3% to KRW729,000. LG Electronics shares were up 3% at KRW56,700.However, despite the immediate boost in share price, some analysts are doubtful whether the change at the top of Apple will give its smartphone competitors much of an edge.
"Apple is a well established company...I believe (Jobs) will still be involved in key decisions," said Samsung Securities analyst Birdy Lu.
The combination of Jobs and his nominated successor, Chief Operating Officer Tim Cook,"should help Apple maintain its competitive edge. I don't think HTC will get much help from this news."
HTC and Samsung declined to comment on the developments at Apple. LG Electronics spokesman Ken Hong declined to elaborate on the potential impact on the company's smartphone business, but added that LG is confident Apple will continue to succeed.
Shares in Taiwan-based Hon Hai Precision Industry Co., which assembles Apple's gadgets at factories in China, were recently down 1.7% at NT$63.70. Hon Hai said in a statement it believes Apple will continue to thrive.
"Hon Hai and Apple are long-time partners. We believe our relationship will get closer in the future in spite of the management change," it said.
Shares in touch screen supplier Wintek Co. fell 4.8% to NT$22.80. Catcher Technology Co., which makes the metal casings for Apple's gadgets, were recently off 3.7% at NT$219. Both
companies declined to comment about the potential impact of Jobs' resignation. Meanwhile, some analysts said the resignation could be a negative development for Asian telecom carriers that offer Apple's iPhone. In Japan, shares in Softbank--the only carrier of the iPhone and iPad products--were underperforming the broader Nikkei index.
"Apple's products fueled Softbank's growth in recent years and personal ties between (Softbank CEO) Masayoshi Son and Steve Jobs may have played a major role in shaping the relationship between the two companies," said Tokai Tokyo Research Center analyst Yusuke Tsunoda.
Tsunoda said there are concerns that Apple could decide to use multiple carriers in Japan to sell its products as it does in the U.S., which would be a negative development for Softbank. Softbank wasn't immediately available for comment. Earlier, Apple said Jobs submitted his resignation to the board of directors Wednesday and "strongly recommended" that the board name Tim Cook as his successor.
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