Trump Risk Is Back
Jeroen Blokland | Dec 04, 2019 12:37
The MSCI World Index is down 2.4% over the past few days, as Donald Trump disrupted the extremely positive market sentiment.
The US president reintroduced tariffs on Argentinian and Brazilian steel, threatened to tax French consumer goods after a spat with French president Emmanuel Macron and told reporters he liked the idea of waiting until after the election to make a trade deal with China. All things investors don’t want to hear, as they seek confirmation that things won’t get worse. But what Trump has given them is certainly not that, with potential tariffs on European goods such as cars back in scope. As a result, we have reduced our equity exposure to a marginal overweight and maintain a significant underweight in high yield bonds.
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