Over the last five trading days, telecom stocks initially witnessed a V-shaped recovery on game-changing merger news but later witnessed a sharp fall as concerns over fresh restrictions against Chinese companies intensified fears of an escalating trade war in the telecom domain.

The Trump administration is reportedly mulling to introduce an executive order that could raise the bar for federal agencies to buy or sell products from Chinese technology firms, citing national security issues. The bone of contention stems from an innate desire between the two warring nations to claim dominance in cutting-edge technologies and the next generation of wireless services. The Pentagon has also banned the sale of smartphones from ZTE and Huawei — two of China's leading technology brands — from all military establishments.

Regarding company-specific news, earnings of major telecom companies ruled the roost. The industry's earnings in general appear to be on strong footing backed by healthy growth dynamics thanks to the existing secular trends in cloud computing, artificial intelligence and Big Data.

Recap of the Week's Most Important Stories

1.    Nokia Corporation (NYSE:NOK)'s first-quarter 2018 earnings (non-IFRS) per share of €0.02 or 2 cents missed the Zacks Consensus Estimate of 3 cents. In the year-ago period, the company reported non-IFRS earnings of €0.03 per share. Net sales decreased 9% year over year to €4,929 million ($6,057.3 million) and missed the Zacks Consensus Estimate of $6,271 million. The top line primarily declined due to currency woes and lower net sales in North America.

2.    T-Mobile US, Inc. (NASDAQ:TMUS) and Sprint Corporation (NYSE:S) announced a deal to merge in all-stock transaction at a fixed exchange ratio of 0.10256 T-Mobile shares for each Sprint share, or the equivalent of 9.75 Sprint shares for each T-Mobile share, based on the closing share price on Apr 27. The deal would help to accelerate development of faster 5G wireless networks and ensure that the United States does not cede leadership on the technology to China. The companies expect the deal to close by the first half of 2019 and result in about $6 billion in annual cost savings.

3.    Juniper Networks Inc. (NYSE:JNPR) reported relatively healthy first-quarter 2018 results on the back of a solid performance from the cloud vertical and growth in enterprise business. Despite year-over-year decrease in earnings and revenues, the company was able to beat the respective estimates and remains confident of returning to a growth trajectory by the end of the year. GAAP earnings decreased to $34.4 million or 10 cents per share from $108.8 million or 28 cents per share in the year-earlier quarter primarily due to lower revenues, which fell 11% year over year. Non-GAAP earnings for the reported quarter were $99.5 million or 28 cents per share compared with $178 million or 46 cents per share in the year-ago quarter owing to top-line woes. Non-GAAP earnings, however, beat the Zacks Consensus Estimate of 26 cents.

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