KUALA LUMPUR, July 6 — The average selling price and earnings outlook for local glovemakers remain challenging as the United States President Joe Biden is reportedly considering reducing import tariffs on Chinese goods, said Maybank Investment Bank .
“We do not think that this is the time for bottom fishing glove stocks just yet, hence, we maintain our negative stance on the sector,” said Maybank IB in a research note today According to news reports, Biden may announce a rollback of some tariffs on Chinese consumer goods as soon as this week to counter accelerating inflation in the US.
“Being one of the essential items , and given the insignificant involvement of US companies in glove manufacturing, there is a high chance that there will be a removal of import tariffs on China-made gloves,” said Maybank IB. “Without the import tariffs, there will be more room for the Chinese glovemakers to adjust their pricing and that could lead to further cut in ASP.