China: Bringing the Long-Term Picture into Focus
While Chinese equities have faced increasing scrutiny, we believe the long-term case for the asset class remains compelling—supported by technological advancement, policy support, a resurgent consumer, and attractive current valuations.
This year has seen a resurgence in market volatility following the introduction of comprehensive trade tariffs by the Trump Administration. Adding to this uncertainty, the extent of the tariffs under negotiation remain ever-changing, dampening the global macro demand environment. While disruptive, attempts have been made to de-escalate tensions, with trade talks held in early May between the U.S. and China in Geneva—marking the first high-level interaction between the two sides since Chinese Vice President Han Zheng attended Trump’s inauguration ceremony in January. This followed admissions from the U.S. that the two nations have a shared interest, and that the high level of tariffs between them are unsustainable. While the trade talks have made positive progress with both sides agreeing to significantly lower tariffs for 90 days, future discussions will be closely watched.
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