President Trump has pushed forward with additional rhetoric about bigger tariffs against China. And even changing significant legislation to block Chinese investment into “key” sectors for economic and national security. 


After Daimler warned its outlook for the year ahead isn’t positive considering the impact of tariffs could have, investors are liquidating higher risk investments for safe haven assets.  


This has pushed China to shore up its financial system and mitigate risk by decreasing the reserve ratio requirement by 50 basis points (0.50%). This will unlock $108 billion of liquidity and could potentially be positive for resources. 


Trump’s escalating trade war could not have happened at a worse time for emerging markets who are grappling with monetary policy tightening and rising interest rates in developed markets. Rising yields are generally negative for emerging markets. 


Investors should not be too aggressive with buying right now as we could see another strong sell off in the coming days before the market bounces into year end. Use the volatility to buy good quality shares on the cheap. 


The week ahead: 

Last week’s movers and shakers…

Best Performers: BAT 11.7%; SGL 11.4; HAR 7.8%; DSY 4.7%; ADI 4.7% 

Worst Performers: TSX -17.1%; CMH -9.7%; MMG -8.7%; IMP -8.2%; LHC -6.7% 


Other Economic data releases of interest… 


No Buys this week, wait for current uncertainty to subside and refer to Long Term Ideas below for stocks to buy at good levels.  


Short term Ideas 


Long Term Ideas