Key takeaways

• President Trump has sent letters to multiple countries announcing higher tariffs from 1 August, while many others are still waiting to either receive letters or reach a trade deal. The US will now impose 25% tariffs on imports from Japan and South Korea if no agreement is found by the new deadline. Around a dozen other countries, including Malaysia, Kazakhstan, South Africa, and Myanmar, are also facing new tariffs ranging from 25% to 40%.
• The global market reaction is mixed. US stocks fell around -1% but the possibility for negotiations is putting some Asian markets in the green today. The JPY weakened but KRW retraced its initial weakness. The announcements come as investors are already watching rising US debt levels and higher long-term borrowing costs, so there’s some mild pressure on bonds, though Fed rate cut expectations haven’t materially moved on the news.
• The new tariffs could raise the risk of upward pressure on inflation while weighing on corporate profit margins. That said, much of the hit to 2025 earnings expectations has already been priced in, with very conservative earnings growth assumptions for Q2. In the short term, investors will clearly watch for new sector and country-specific headlines.

Please refer to the full report for details about the event and our investment view.

https://www.hsbc.com.my/wealth/insights/market-outlook/special-coverage/tariff-deadline-pushed-back-to-august-1-resulting-in-further-uncertainty-for-global-financial-markets/