Equity Research

President Trump has announced a 90 day pause on the additional country-specific portion of the “reciprocal” tariff. This leaves in place all prior tariffs and the 10% minimum portion of the reciprocal tariff, and we continue to expect additional sector-specific tariffs. Together, these tariffs are likely to sum to something close to our previous expectation of a 15pp increase in the effective tariff rate. As a result, we are reverting to our previous non-recession baseline forecast with GDP growth of 0.5% and a 45% probability of recession.

9 April 2025 | Research | Economics - Jan Hatzius and others

Global Markets Daily: Making Sense of the Moves in Treasury Yields

Amid rising recession risks and the sharp drawdown in risk assets, the breakdown in the typical relationship of lower yields and lower risk assets in these risk-off periods has become increasingly extreme. In today's Daily, we assess the drivers of this relative weakness in Treasuries.

9 April 2025 | Research | Economics - Bill Zu and others

WEBCAST REPLAYS
Research Unplugged: GOAL Asset Allocation: An overview of ourcore views across assets
Bond Market & Cross Asset Views

Base Metals Comment: Copper: From Incentive Pricing To Cost Support

We reduce our copper price forecast as we incorporate our economists' GDP downgrades from the last few days, including the forecast of a stagnating US economy. Our base case is that the effective US tariff rate will rise by 15pp in total, which would now require a large reduction in the tariffs scheduled to take effect on April 9.

			New	Old
LME Copper ($/mt)		2025 2026	8,850 10,170	9,740 11,175

9 April 2025 | Research | Economics - Eoin Dinsmore and others

UPCOMING WEBCASTS:
Bear Market Anatomy – the path and shape of the bear market
10 Apr 2025 | 9:30am NY | 2:30pm LN
REGISTER

Cross Asset Strategy: Risk Appetite Collapse
10 Apr 2025 | 4pm HK
REGISTER

Asia Credit Notes: Tariffs Have Limited Direct Impact on Asia HY Corporates; Value Emerging for Indonesia and India BB

Asia spreads decompress, though underperformance is not uniform. Over the past month, spreads on the ICE-BAML Asia Dollar HY index have widened by 201bps, pushing Asia HY Corporate spreads to 498bps. From a valuation perspective, Asia HY Corp spreads are now at the 18th percentile for the period from Jan 2010 to now - so whilst they are no longer near historical tight levels, they are not at particularly cheap levels either. That said, India and Indonesia HY have significantly underperformed, with YTD total return of -5.2% and -4.7%, respectively. Is the sharper selloff across India and Indonesia HY justified?

9 April 2025 | Research | Credit Strategy - Kenneth Ho and others

Visit the Trade policy page for more >

MACRO IMPLICATIONS
Global Markets Comment: After the Tariffs—Still Room to Price Recession (Wilson/Chang)
9 Apr 2025 | 6:31am| 10pg| Research | Economics-Dominic Wilson and others
US Daily: 5 Questions on the Near-Term Outlook for Trade and Fiscal Policy (Phillips)
10 Apr 2025 | 12:14am| 8pg| Research | Economics-Jan Hatzius and others
Global Strategy Paper: Bear Market Anatomy – the path and shape of the bear market
8 Apr 2025 | 12:00pm| 20pg| Research | Portfolio Strategy-Peter Oppenheimer and others

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Equity IMPLICATIONS
Australia Healthcare: Tariff impacts: Sector considerations
10 Apr 2025 | 6:38am| 20pg| Research | Equity-Davin Thillainathan, CFA and others
Japan Healthcare: Pharmaceuticals: Estimating profit impact of additional tariffs
10 Apr 2025 | 4:17am| 10pg| Research | Equity-Akinori Ueda, Ph.D. and others
ASEAN Banks: Cutting EPS for macro risk; focus on stocks with sustainable profitability
9 Apr 2025 | 6:43pm| 23pg| Research | Equity-Melissa Kuang, CFA and others

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Strategy Espresso: Europe equities and the US Bear

After President Trump’s larger-than-expected tariff announcement raising the US recession risk and preempting a sell-off in global markets - taking many to bear-market territory - we consider the implications for Europea...

8 Apr 2025 | 12:01pm| 12pg| Research | Portfolio Strategy-Sharon Bell and others

PDD Holdings (PDD): Refreshing Temu US sensitivity analysis on tripling of de-minimis duties; Further shift to local-to-local & non-US

On April 9, the US lifted China import tariffs to 104% and the White House announced a tripling of de-minimis duties to 90% (from previously announced 30%) on small packages under US$800 by value shipped from Mainland China and Hong Kong, to be effective from May 2. Such cross-border packages will be subject to a duty rate of either 90% (from previously announced 30%) of their value, or US$75 per item (from US$25 prior), to be increased to US$150 per item after June 1st, 2025 (from US$50 prior). With this note, we refresh our Temu US GMV/order volume demand elasticity sensitivity analysis incorporating the increase in de minimis tariff (vs. our earlier analysis). Our sensitivity analysis would imply a significantly larger impact/hit to Temu's US volumes on the cost push, which in turn would likely further accelerate the shift of Temu's business to local warehouses and local merchants, and further its ongoing diversification to non-US markets.

9 Apr 2025 | 4:19pm| 10pg| Research | Equity-Ronald Keung, CFA and others

IN THE SPOTLIGHT

Australian Small & Mid Cap: 16th Annual Emerging Leaders Conference: Key Takeaways

We hosted 11 companies at our 16th Annual Emerging Leaders Conference. This year, we moderated discussions with management from AD8, APZ, CDA, GDG, HLI, IMD, MAQ, NGI, SDR, SXE, WGN. Key takeaways within.