Chip maker Qualcomm jumped as much as 5 percent Thursday after news of a deal between U.S. officials and Chinese telecom giant ZTE.

The leading U.S. chipmaker had for weeks been caught in the crosshairs of growing trade tensions. U.S. officials had banned American companies from selling components to ZTE, and Qualcomm is a major chip supplier for ZTE phones.

The deal announced on Thursday, which ends sanctions and imposes a $1 billion fine on ZTE, contains any “ripple impacts that could have damaged the prospects of the chip sector,” GBH Insights analyst Dan Ives told CNBC.

“The Street is relieved this ZTE situation is [now] resolved as it’s an olive branch that will help the broader tech sector with a thawing of tensions, especially on the [telecommunications] front,” Ives said.

Qualcomm is still waiting on Chinese approval on its proposed merger with Dutch semiconductor company NXP. CEO Steve Mollenkopf told CNBC in April that trade tensions with China were likely stalling the deal.

Qualcomm is down 3 percent on the year but up 7 percent in the 12-month period.

Source: Tech CNBC
Qualcomm shares jump after US strikes deal with China's ZTE