The biggest losers in a US-China trade war
Tags: Donald Trump | Trade | US China trade war
By Jessica Tasman-Jones, 12 Apr 18
Making good on campaign promises made in the run-up to the 2016 election, Donald Trump has threatened tariffs of $160bn against China, while retaliatory measures from the Asian powerhouse totalling $50bn aim to target politically-sensitive areas of the US economy. Portfolio Adviser asks the investment industry which sectors would be worst hit if the war of words turns into reality.
Mark Sherlock, head of US equities, Hermes Investment Management
“There are certain sectors that currently appear most affected by proposed trade tariffs. These include industrials – specifically aerospace (air freight being the primary transport mode for pharmaceutical-based products) and autos. Anything that subdues global trade is unwelcome in creating a headwind for economically sensitive stocks. Consumer discretionary and technology are also exposed. Within small and mid-cap, the greater domestic exposure of this index over large cap (c70% versus c55% for the S&P) should moderate the worst of the effects of import tariffs, albeit only in the short term.”