Trade conflict between China and the USA – Update from the Investment Division

Trade conflict between China and the USA – Update from the Investment Division
Trade conflict between China and the USA – Update from the Investment Division
(c) unsplash
Share post:

What’s happened since yesterday?

In the USA yesterday there were small steps towards a compromise for another economic stimulus package. Nancy Pelosi, the Democratic spokeswoman in the House of Representatives, said her party was prepared to halve the demands on the size of the stimulus package from the last USD 3,500 billion to make progress with the White House. The Trump administration sees an opportunity to agree on a smaller round of aid measures in the amount of USD 500 bn.

Regardless, US President Trump announced yesterday that he had cancelled the US-China trade talks over the weekend because he “did not want to talk to China now”. Meanwhile, the State Department has called on US universities to disinvest investments in China in their foundation portfolios.

The trade conflict between China and the USA is thus gaining further momentum. In our opinion, this should also be seen against the background of the approaching presidential election campaign. In this campaign, President-Trump will take a hard line towards China on both political and economic issues. It appears that he is currently laying the foundations for this election campaign strategy.

The markets have not been very impressed by this escalation in the trade conflict in recent days and weeks, as was the case yesterday. The US leading index, the S&P 500, rose 0.2%, while most European stock exchanges closed with slight losses (EuroStoxx50 -0.49%). Yields on investment grade government bonds fell yesterday. Currently, the yield on 10-year US government bonds is 0.66% and that on German government bonds is -0.47%.


Legal note:
Prognoses are no reliable indicator for future performance.


Legal disclaimer

This document is an advertisement. Unless indicated otherwise, source: Erste Asset Management GmbH. Our languages of communication are German and English.

The prospectus for UCITS (including any amendments) is published in accordance with the provisions of the InvFG 2011 in the currently amended version. Information for Investors pursuant to § 21 AIFMG is prepared for the alternative investment funds (AIF) administered by Erste Asset Management GmbH pursuant to the provisions of the AIFMG in connection with the InvFG 2011. The fund prospectus, Information for Investors pursuant to § 21 AIFMG, and the Key Information Document can be viewed in their latest versions at the web site within the section mandatory publications or obtained in their latest versions free of charge from the domicile of the management company and the domicile of the custodian bank. The exact date of the most recent publication of the fund prospectus, the languages in which the Key Information Document is available, and any additional locations where the documents can be obtained can be viewed on the web site A summary of investor rights is available in German and English on the website as well as at the domicile of the management company.

The management company can decide to revoke the arrangements it has made for the distribution of unit certificates abroad, taking into account the regulatory requirements.

Detailed information on the risks potentially associated with the investment can be found in the fund prospectus or Information for investors pursuant to § 21 AIFMG of the respective fund. If the fund currency is a currency other than the investor's home currency, changes in the corresponding exchange rate may have a positive or negative impact on the value of his investment and the amount of the costs incurred in the fund - converted into his home currency.

This document serves as additional information for our investors and is based on the knowledge of the staff responsible for preparing it at the time of preparation. Our analyses and conclusions are general in nature and do not take into account the individual needs of our investors in terms of earnings, taxation, and risk appetite. Past performance is not a reliable indicator of the future performance of a fund.

Leave a comment Required fields are marked with *

Your email address will not be published. Required fields are marked *