Global markets are bouncing back, but a new survey of company chiefs finds that they’re on edge and are looking to cut back on investment.
Markets catch their breath
Investors are breathing a bit easier on Monday, with markets rallying in Asia and Europe on hopes for a reprieve on tech tariffs. The optimism seems to contradict President Trump’s own words.
The president has signaled that yet another round of levies are on the way, sowing more confusion among business leaders about what’s on, what’s off — and how to deal with their new reality.
Is Trump undermining his own position? If the tariffs are in fact being watered down, that could erode his bargaining power — not to mention his argument that high-tech imports fall into a special national security category — as he seeks to bring back manufacturing to U.S. shores.
The latest: Companies are bracing for new Trump tariffs as soon as this week on the chips and tech components that power phones, computers and other consumer gadgets. The president also played down a Friday announcement by his administration sparing many of the same popular electronics from punishing levies. “NOBODY is getting ‘off the hook,’ ” Trump posted to Truth Social, adding, “especially not China which, by far, treats us the worst!”
Tensions are rising with Beijing. Xi Jinping, China’s leader, took a shot on Monday at Trump’s increasingly protectionist policy ahead of his tour of Cambodia, Malaysia and Vietnam — countries that have become essential suppliers to American businesses — to shore up regional trade ties. “The tariff war will produce no winner,” Xi said.
A protracted standoff could destabilize the global supply chain, analysts warn. Xi “can wait out the United States,” Nouriel Roubini, an economist and senior adviser at the hedge fund Hudson Bay Capital, told Bloomberg Television on Monday. “In the short term, China has a lot of leverage,” he added, including placing trade restrictions on companies like Apple and Tesla.