Financial Center / Comprehensive Report
Trump's reciprocal tariff policy disrupted market rhythms, leading to a temporary decline in both stocks and bonds. However, as he softened his hardline stance, market sentiment gradually improved. Nevertheless, since April, the 966 foreign funds approved by Taiwan's Financial Supervisory Commission have averaged a decline of 1.48%. Among them, 683 equity funds fell by an average of 1.46%, while 265 bond funds fell by 1.55% (as of 4/29).
Trump's tariff policy hit the market hard, causing US stock and small-cap equity funds to drop by 2.97% and 5.53%, respectively. In contrast, Latin America and Eastern Europe, which were less affected, showed strong performances, with Japan and India benefiting from strong domestic markets and trade negotiation progress, rising by 1.25% and 0.29% respectively. Amid increasing uncertainty, gold funds, as a safe-haven choice, rose by 4.16%, marking the best performance.
Franklin Securities Advisors point out that Trump's tariff policy has reignited concerns about stagflation, weakening market confidence in dollar assets and driving funds into the gold market. Additionally, the global demand for central bank reserve diversification also supports gold prices. The rise in gold prices is expected to offset some of these pressures from rising raw material costs. Furthermore, Franklin Templeton’s Japanese fund manager, Stephen Land, noted that gold and gold mining stocks play crucial roles in diversified portfolios, particularly in times of rising uncertainty.
Franklin Templeton Japanese Fund Manager Qiu Zhengsong mentioned that most products affected by US tariffs in Japan are capital equipment facing mild price competition. Japan has actively engaged in negotiations with the US, indicating that the impact of tariffs will be relatively limited. The Japanese economy is expected to gradually recover in the medium term.
In the coming years, global stock markets may experience increased volatility due to tariff policies, but Japan's market is expected to offer better risk-return prospects.