May 14, 2018 / 12:25 PM / 2 months ago

U.S. optical stocks jump as Trump softens on China's ZTE

May 14 (Reuters) - Shares of U.S. optical component makers jumped on Monday after President Donald Trump pledged to help ZTE Corp “get back into business, fast” after a U.S. ban hurt the Chinese telecom equipment maker.

Shares of Acacia Communications Inc, which got 30 percent of its total revenue in 2017 from ZTE, jumped nearly 16 percent in premarket trading.

Shares of Oclaro Inc, which earned 18 percent of its fiscal 2017 revenue from ZTE, rose about 8 percent.

Lumentum Holdings Inc, which has signed a deal to acquire Oclaro, rose 5.5 percent, while Finisar Corp gained 4.5 percent.

Trump’s unexpected announcement was a stunning reversal, given Washington’s tough stance on Chinese trade practices that have put the world’s two largest economies on course for a possible trade war.

Shares of optical component makers have tumbled in the past month since the U.S. Commerce Department banned American companies from selling to ZTE for seven years as punishment for breaking a 2017 agreement. (Reporting by Shreyashi Sanyal in Bengaluru)

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