The China Show 8/1/2025

Recent expert commentary indicates varied perspectives on US trade policy and its impact, with a former Taiwan lawmaker suggesting US tariffs are manageable as an ex-US official notes the Trump trade plan nears completion. UBP's Senior Economist for Asia, Casanova, also weighed in on tariffs, reflecting ongoing geopolitical and trade dynamics. Despite these potential headwinds and anticipated market eventfulness, Nomura projects that equities will remain profitable through year-end.

Analysis

Expert commentary highlights a dual focus on evolving US trade policy and the broader equity market outlook. On the geopolitical front, insights from a UBP Senior Economist and a former US official suggest that tariff discussions and the finalization of the Trump trade plan remain central themes. A former Taiwan lawmaker has characterized the potential impact of US tariffs as 'manageable,' suggesting a degree of resilience may be priced into affected markets. Juxtaposed with these potential trade-related headwinds is a distinctly bullish forecast from Nomura, which projects that equities will remain profitable through year-end despite an anticipated 'eventful' period. This creates a market narrative where ongoing trade policy developments are a key risk factor, yet the underlying sentiment for equity performance, as articulated by Nomura, remains moderately positive.

Key Decisions for Investors

• Investors may consider aligning with Nomura's optimistic equity outlook for the remainder of the year, while remaining prepared for the 'eventful' market volatility it anticipates.
• Closely monitor developments in US trade policy, particularly regarding tariffs and the reported finalization of trade plans, as these are identified as primary sources of potential market disruption.
• Evaluate portfolio resilience to geopolitical shocks, as the 'manageable' view on tariffs from some sources may not fully mitigate risks if trade rhetoric escalates unexpectedly.