Here’s What an All-Out Trade War Looks Like in Global Markets
Trade misery acquaints the markets with strange bedfellows.
What else would unify Indonesian bonds, semiconductor ETFs and Italian debt but this U.S-China showdown on tariffs.
Wall Street is issuing words of caution on the expansive collateral damage, forcing investors of all stripes to stress-test what-if scenarios, from bets on U.S. Treasuries to the very fringes of risk.
“This changes the thought process,” Daniel Gerard, head of investment and risk advisory for Asia Pacific in Singapore at State Street Bank & Trust Co., said in an interview with Bloomberg TV. “If this continues this changes our decision from being pro-late cycle -- a growth story -- into a more defensive case.”
For bulls who have ridden the speculator rally in risk, here’s a gut check across assets.
Global equities have pole-vaulted over the wall of worry on trade this year -- so naturally this week’s brinkmanship threatens to spur a material pullback.
The question is: How bad can things get?
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