Escalating tension between the United States and China will encourage volatility as the Presidential Election approaches and measures taken against Chinese technology will be the focus. Investors underestimate domestic policy support for Chinese technology, as well as the political risks to American technology, explains Evan Brown, Head of Multi Asset Strategy at UBS AM.
US China tensions
Mathieu Racheter (Julius Baer) | President Trump recently urged to halt plans of the government’s main pension fund to invest in Chinese equities. While the implications for Chinese ADRs listed in the US should be fairly small, there is a risk that the administration will extend the restrictions to other US investors. We continue to view Chinese equities as a core holding and reiterate our strategic Overweight rating.