April 3, 2025 • 13 mins
Markets wrap up a turbulent week as Asian shares fall to the lowest level in two months, extending a global selloff in stocks after President Donald Trump’s latest tariff measures drove investors into haven assets. Stateside, the S&P 500 tumbled more than 4.8% for its worst single-day drop since 2020. We speak with Garfield Reynolds, Bloomberg MLIV Asia team lead in Sydney.
Plus - Steve Brice, Chief Investment Officer at Standard Chartered Wealth Solutions, shares how he’s navigating the recent market volatility. He speaks with Bloomberg’s Haidi Stroud-Watts and Paul Allen.
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Episode Transcript
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Speaker 1 (00:02):
Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2 (00:10):
Welcome to the Bloomberg Daybreak Asia Podcast. I'm Doug Chrisner.
So markets in Asia are wrapping up what certainly has
been a very rough week and obviously the key driver
President Trump's latest tariff measures. Here in the States, we
had a meltdown in risk assets. The S and P
five hundred tumbled more than four point eight percent. We
closed very near session lows. It was the worst single
(00:33):
day drop for the S and P since twenty twenty,
and in the process this selloff wiped out about two
trillion dollars in market value. We also saw a great
deal of dollar weakness, with the Bloomberg Dollar Spot Index
down one and a half percent in New York. Trading
oil joined in on a selloff in commodities, with WTI
falling six point six percent in New York. And in
(00:57):
a moment we'll be hearing from Steve Brice. He is
the c IO at Standard Chartered Wealth Solutions Group. But
we begin this morning in Sydney. Joining me now is
Garfield Reynolds, who leads Bloomberg's Markets live coverage for the
Asia Pacific. Garfield joining from our studios in Sydney. Talk
to me a little bit about what you witnessed yesterday, Garfield,
(01:17):
with the price action across the Asia Pacific and what
we're seeing now in early trading.
Speaker 1 (01:22):
Yeah, the price action in Asia yesterday was extraordinary, but
it was fed by an announcement that was confusing, in
a paque, in the presentation, in the methodology, which ultimately
ended up being based on a very simplistic and not
(01:44):
really credible on an economic basis formula. So you just
sort of had waves of reaction every time you thought
maybe the market'spite consolidated, either fresh investors came in as
the time zones changed, or right a realization came through
just how potentially damaging this is. And you were saying
(02:06):
that the sell off for US stocks was the biggest
since the pandemic, as it should have been, given that
this is the biggest shock to the global economy since
the pandemic.
Speaker 2 (02:17):
And the question now is whether or not it precipitates
a recession. Was it very interesting today that President Trump
said he's open to reducing these tariffs if other nations
were willing to offer something. And I think the word
he used here was phenomenal, that says to me that
there is the room to negotiate, but we may have
to accept the fact that in that process that could
(02:39):
be quite lengthy, tariffs may be in place for a while.
Speaker 3 (02:43):
Is that fair?
Speaker 1 (02:44):
Yeah, that's fair, And it actually adds to there's an
argument to be made if you wanted to raise the
average tariff rate in the US to something like twenty
five to thirty percent, then just do it and and
move on. And you know, that's the the avowed aims
of the Trump administration to increase revenue from tariffs and
(03:08):
also to push foreigners to bring manufacturing back to the
US because otherwise they will be priced out of the
US market. If you think that's the way to go,
then you do big tariffs and you stick with them
for at least a while. Maybe you give a timetable,
you say these are going to be in for a year.
(03:28):
But instead we have a situation where nobody knows how
long these tariffs will be in for what they will
actually entail. So for businesses, you've got a lot of
pain but also a lot of clarity. You know, do
you And for most companies it'll be okay, I'm going
to punt my business plans for what six months a
(03:49):
year until I can be sure what I'm dealing with.
Speaker 2 (03:52):
So the selloff that we had here in the US
makes for an unusual setup for what is really the
most closely watch data point of the month at being
the government's report on employment. So in addition to that,
tomorrow we're going to be hearing from FED share J. Powell.
Obviously the story on tariff's will make the Fed's job
a lot more complicated. It seems a case of either
(04:16):
the Fed lower's interest rates to support the economy or
it keeps them elevated to contain inflation. Where do you
see the greater risk right now economic weakness or stubborn
inflation or are they kind of evenly balanced.
Speaker 1 (04:29):
Well, I think economic weakness is the greater risk. But
part of the risks there are precisely that the FED
has the potential to sit where it is while it
wastes to see what happens. There's definitely an increase in
inflation expectations. They were already concerned that there were signs
(04:51):
that this inflationary trend was stalling out. They had been
talking about the idea that interest rates now are in
a good place, and they don't see any reason to
rush to change them. And when you've got this, as
I said, very confusing introduction of tariffs that could have
(05:11):
major impacts on the US economy, you're going to have
a lot of volatility about the data coming in and
uncertainty about all sorts of data and what the long
term impacts are actually going to be.
Speaker 2 (05:26):
In terms of retaliation. What do we know about what
we're hearing from governments in Asian I'm particularly curious about
the Chinese response.
Speaker 1 (05:35):
Well, China's response has also been pretty opaque. It's not
a little clear exactly what they are going to do.
They do have a track record of actually waiting until
the tariffs are imposed before they announced their response. Now
that means we could be waiting till April nine, because
(05:55):
the ten percent on everybody comes in April five, and
then the addition tariffs come in on top of that
on April nine. So does China renounce some stuff April
five and then more on April nine, or just everything
on April nine. We've also got no real clarity on
whether a TikTok deal will actually happen. A lot of
(06:18):
talk from the US side that one is coming and
that that could lead to tariff relief. If that a curse,
then that would take China retaliation off the table, you
would think. But there's no clarity as to where this.
We don't really have much of a clue as to
whether China is really interested in letting TikTok essentially slip
out of its hands.
Speaker 2 (06:38):
Yeah, I think that TikTok deadline is this weekend here
in the US. Garfield, thank you so much for taking
the time to chat with us. Garfield Reynolds there. He
leads Bloomberg's markets live coverage for the Asia Pacific and
Garfield joining today from our studios in Sydney here on
the Daybreak Asia podcast. Welcome back to the Daybreak Asia Podcast.
(07:08):
I'm Doug Prisner. We're seeing further downside from markets in
the Asia Pacific. This is after US equities and the
dollar suffered their worst day in years. Shares in Australia
and Japan fell right at the open. For some market perspective,
we heard earlier from Steve Brice. He is the CIO
at Standard Chartered Wealth Solutions Group. He spoke with Bloomberg's
(07:28):
Paul Allen and Heidi Stroud Watts.
Speaker 1 (07:30):
So it doesn't feel like we're going to see the
volatility abate anytime soon.
Speaker 2 (07:37):
How do you sort of progress from here? What's your
take on how to navigate these markets?
Speaker 4 (07:42):
Yes, I guess everybody's now just adjusting to these peak
tariffs that we've been seeing implemented in the US and
just trying to figure out what the next steps are,
whether it's going to be retaliatory or whether we're going
to see some sort of negotiations taking place. The likely is,
of course, it's going to be a bit of both,
(08:03):
and then the openness or willingness of the US administration
to renegotiate these tariffs lower. So I guess everybody realizes
this is bad for growth and good for it and
picks up inflation. So the question everybody needs to ask is,
you know, what are the scenarios from here from a
growth perspective? Is President Trump? Is he an idiot or
(08:26):
is he being is he unconstrained? I don't believe he's
either of those things. So you know, he's clearly using
this or most likely using this as a negotiating tool
to try and get a better trade agreements with different
different counterparties. And we're also seeing in Congress the Republicans
have a voice again, so it's certainly not a majority
(08:48):
questioning his leadership, but certain people now started asking the
question as to whether this is the appropriate thing, and
that leads to the point of do we still have
a Trump put And we believe the answer to that
is yet it is yes. The question is when does
that kick in? So for individual investors, you know, with
a long term time horizon, this is where you make
(09:09):
your money. You buy on weakness, whether we'll see further downside.
We still think we might see something further downside in
the short term, but these are the great opportunities when
markets go on sale for people to build long term wealth.
Speaker 1 (09:23):
Where are you buying the dip then if you were
in that scenario.
Speaker 4 (09:26):
So for the S and P five hundred, we're actually
challenging one of the key supports that we highlighted yesterday,
so five four hundred, so we just marginally below that
at the close last night. Next one is around five
to one twenty, so obviously that's a decent way away.
So the way we would suggest this is saying, look,
you know, we should be diversified across different asset classes,
(09:48):
across geographers in the world as well. But you know,
if you look at the US on a standalone basis,
you know, averaging to you know, from now down to
those sort of levels probably make sense. Assuming we're right
that that Trump put is still there.
Speaker 3 (10:04):
I want to take a look at the Magnificent seven,
although in this chat on the Bloomberg terminal we're now
referring it to it as the Lag seven. But there's
some really quality names here in bear market territory. Now,
if you're willing to take a long term view, is
this the moment to get.
Speaker 4 (10:19):
In so certainly. I mean, you know, obviously we've seen
valuations come off quite dramatically, so that was always the
concern with these names was that valuations are are a
big challenge, and now that's becoming less of a concern.
They still have very strong fundamentals by and large. I think,
you know, names affiliated with Elon Musk obviously have different
(10:41):
headwinds potentially than some of the other companies. So that's
you know, that's something that you have to factor into
your decision making process. But from our perspective, we are
overweight tech looking to buy the dip in the tech
set in the US tech sector as well, so that
would fit into this mag seven rebound at some point.
Speaker 3 (11:00):
You're also overweight China. Now the market there is closed today,
but we saw some pretty modest declines yesterday compared to
what we saw in the US. What's your outbook for
China stocks?
Speaker 4 (11:11):
So, I mean, we do feel that China will probably
weaken a little bit in the in the near term.
Obviously the tariff effect. You know, they ha been pretty resilient. Obviously,
the market's done very well so far this year, so
you know, but we would be buying on dips there
as well. You know, we believe that the technology sector
in particular is an area of key interest for US.
(11:32):
You know, obviously the deep Seek revelation still feeding into
a more bullish environment for tech sector. Valuations in the
in China are pretty cheap still, so from that perspective,
we like their hang sending in decks, you know, buying
down you know, maybe three five percent there than we
are today, and the same on the tech sector as
well for the Hang Seng.
Speaker 3 (11:52):
Southeast Asia, Emerging Asia obviously as part of that channel
plus one strategy, some of the hardest.
Speaker 2 (11:57):
Hits in these tariffs. Do you still see opportunities to
use when it comes to in this region.
Speaker 4 (12:03):
So we're underweight Asian, so from you know, so we're
overweight China, underweight Assien at the moment, and I think
that's one of one of the reasons was we felt
that the China was probably better prepared for the tariffs
than maybe Asian. Obviously that China plus one strategy was
a huge boon to the region, but I think that's
something that's in the cross hairs of US policy now.
So and you know, obviously the formula being used by
(12:25):
the by the US to determine what tariff should be,
it's sort of symptomatic of that, and that's why Asian
is probably facing significant headwinds at the moment. So yeah,
it's it's it's not an area of focus for US. Obviously,
value will be created through this in our opinion if
we think that tariffs are going to be transitory or
at least not at these levels or so we were
at peak tariff's, But for us, our focus is elsewhere.
Speaker 2 (12:48):
That was Steve Bryce, chief investment officer at Standard Chartered
Wealth Management, speaking earlier with Bloomberg's Paul Allen and Heidi
Stroud Watts here on the Daybreak Asia podcast. Thanks for
listening to today's episode of the Bloomberg Daybreak Asia Edition podcast.
Each weekday, we look at the story shaping markets, finance,
(13:10):
and geopolitics in the Asia Pacific. You can find us
on Apple, Spotify, the Bloomberg Podcast YouTube channel, or anywhere
else you listen. Join us again tomorrow for insight on
the market moves from Hong Kong to Singapore and Australia.
I'm Doug Chrisner, and this is Bloomberg
Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2 (00:10):
Welcome to the Bloomberg Daybreak Asia Podcast. I'm Doug Chrisner.
So markets in Asia are wrapping up what certainly has
been a very rough week and obviously the key driver
President Trump's latest tariff measures. Here in the States, we
had a meltdown in risk assets. The S and P
five hundred tumbled more than four point eight percent. We
closed very near session lows. It was the worst single
(00:33):
day drop for the S and P since twenty twenty,
and in the process this selloff wiped out about two
trillion dollars in market value. We also saw a great
deal of dollar weakness, with the Bloomberg Dollar Spot Index
down one and a half percent in New York. Trading
oil joined in on a selloff in commodities, with WTI
falling six point six percent in New York. And in
(00:57):
a moment we'll be hearing from Steve Brice. He is
the c IO at Standard Chartered Wealth Solutions Group. But
we begin this morning in Sydney. Joining me now is
Garfield Reynolds, who leads Bloomberg's Markets live coverage for the
Asia Pacific. Garfield joining from our studios in Sydney. Talk
to me a little bit about what you witnessed yesterday, Garfield,
(01:17):
with the price action across the Asia Pacific and what
we're seeing now in early trading.
Speaker 1 (01:22):
Yeah, the price action in Asia yesterday was extraordinary, but
it was fed by an announcement that was confusing, in
a paque, in the presentation, in the methodology, which ultimately
ended up being based on a very simplistic and not
(01:44):
really credible on an economic basis formula. So you just
sort of had waves of reaction every time you thought
maybe the market'spite consolidated, either fresh investors came in as
the time zones changed, or right a realization came through
just how potentially damaging this is. And you were saying
(02:06):
that the sell off for US stocks was the biggest
since the pandemic, as it should have been, given that
this is the biggest shock to the global economy since
the pandemic.
Speaker 2 (02:17):
And the question now is whether or not it precipitates
a recession. Was it very interesting today that President Trump
said he's open to reducing these tariffs if other nations
were willing to offer something. And I think the word
he used here was phenomenal, that says to me that
there is the room to negotiate, but we may have
to accept the fact that in that process that could
(02:39):
be quite lengthy, tariffs may be in place for a while.
Speaker 3 (02:43):
Is that fair?
Speaker 1 (02:44):
Yeah, that's fair, And it actually adds to there's an
argument to be made if you wanted to raise the
average tariff rate in the US to something like twenty
five to thirty percent, then just do it and and
move on. And you know, that's the the avowed aims
of the Trump administration to increase revenue from tariffs and
(03:08):
also to push foreigners to bring manufacturing back to the
US because otherwise they will be priced out of the
US market. If you think that's the way to go,
then you do big tariffs and you stick with them
for at least a while. Maybe you give a timetable,
you say these are going to be in for a year.
(03:28):
But instead we have a situation where nobody knows how
long these tariffs will be in for what they will
actually entail. So for businesses, you've got a lot of
pain but also a lot of clarity. You know, do
you And for most companies it'll be okay, I'm going
to punt my business plans for what six months a
(03:49):
year until I can be sure what I'm dealing with.
Speaker 2 (03:52):
So the selloff that we had here in the US
makes for an unusual setup for what is really the
most closely watch data point of the month at being
the government's report on employment. So in addition to that,
tomorrow we're going to be hearing from FED share J. Powell.
Obviously the story on tariff's will make the Fed's job
a lot more complicated. It seems a case of either
(04:16):
the Fed lower's interest rates to support the economy or
it keeps them elevated to contain inflation. Where do you
see the greater risk right now economic weakness or stubborn
inflation or are they kind of evenly balanced.
Speaker 1 (04:29):
Well, I think economic weakness is the greater risk. But
part of the risks there are precisely that the FED
has the potential to sit where it is while it
wastes to see what happens. There's definitely an increase in
inflation expectations. They were already concerned that there were signs
(04:51):
that this inflationary trend was stalling out. They had been
talking about the idea that interest rates now are in
a good place, and they don't see any reason to
rush to change them. And when you've got this, as
I said, very confusing introduction of tariffs that could have
(05:11):
major impacts on the US economy, you're going to have
a lot of volatility about the data coming in and
uncertainty about all sorts of data and what the long
term impacts are actually going to be.
Speaker 2 (05:26):
In terms of retaliation. What do we know about what
we're hearing from governments in Asian I'm particularly curious about
the Chinese response.
Speaker 1 (05:35):
Well, China's response has also been pretty opaque. It's not
a little clear exactly what they are going to do.
They do have a track record of actually waiting until
the tariffs are imposed before they announced their response. Now
that means we could be waiting till April nine, because
(05:55):
the ten percent on everybody comes in April five, and
then the addition tariffs come in on top of that
on April nine. So does China renounce some stuff April
five and then more on April nine, or just everything
on April nine. We've also got no real clarity on
whether a TikTok deal will actually happen. A lot of
(06:18):
talk from the US side that one is coming and
that that could lead to tariff relief. If that a curse,
then that would take China retaliation off the table, you
would think. But there's no clarity as to where this.
We don't really have much of a clue as to
whether China is really interested in letting TikTok essentially slip
out of its hands.
Speaker 2 (06:38):
Yeah, I think that TikTok deadline is this weekend here
in the US. Garfield, thank you so much for taking
the time to chat with us. Garfield Reynolds there. He
leads Bloomberg's markets live coverage for the Asia Pacific and
Garfield joining today from our studios in Sydney here on
the Daybreak Asia podcast. Welcome back to the Daybreak Asia Podcast.
(07:08):
I'm Doug Prisner. We're seeing further downside from markets in
the Asia Pacific. This is after US equities and the
dollar suffered their worst day in years. Shares in Australia
and Japan fell right at the open. For some market perspective,
we heard earlier from Steve Brice. He is the CIO
at Standard Chartered Wealth Solutions Group. He spoke with Bloomberg's
(07:28):
Paul Allen and Heidi Stroud Watts.
Speaker 1 (07:30):
So it doesn't feel like we're going to see the
volatility abate anytime soon.
Speaker 2 (07:37):
How do you sort of progress from here? What's your
take on how to navigate these markets?
Speaker 4 (07:42):
Yes, I guess everybody's now just adjusting to these peak
tariffs that we've been seeing implemented in the US and
just trying to figure out what the next steps are,
whether it's going to be retaliatory or whether we're going
to see some sort of negotiations taking place. The likely is,
of course, it's going to be a bit of both,
(08:03):
and then the openness or willingness of the US administration
to renegotiate these tariffs lower. So I guess everybody realizes
this is bad for growth and good for it and
picks up inflation. So the question everybody needs to ask is,
you know, what are the scenarios from here from a
growth perspective? Is President Trump? Is he an idiot or
(08:26):
is he being is he unconstrained? I don't believe he's
either of those things. So you know, he's clearly using
this or most likely using this as a negotiating tool
to try and get a better trade agreements with different
different counterparties. And we're also seeing in Congress the Republicans
have a voice again, so it's certainly not a majority
(08:48):
questioning his leadership, but certain people now started asking the
question as to whether this is the appropriate thing, and
that leads to the point of do we still have
a Trump put And we believe the answer to that
is yet it is yes. The question is when does
that kick in? So for individual investors, you know, with
a long term time horizon, this is where you make
(09:09):
your money. You buy on weakness, whether we'll see further downside.
We still think we might see something further downside in
the short term, but these are the great opportunities when
markets go on sale for people to build long term wealth.
Speaker 1 (09:23):
Where are you buying the dip then if you were
in that scenario.
Speaker 4 (09:26):
So for the S and P five hundred, we're actually
challenging one of the key supports that we highlighted yesterday,
so five four hundred, so we just marginally below that
at the close last night. Next one is around five
to one twenty, so obviously that's a decent way away.
So the way we would suggest this is saying, look,
you know, we should be diversified across different asset classes,
(09:48):
across geographers in the world as well. But you know,
if you look at the US on a standalone basis,
you know, averaging to you know, from now down to
those sort of levels probably make sense. Assuming we're right
that that Trump put is still there.
Speaker 3 (10:04):
I want to take a look at the Magnificent seven,
although in this chat on the Bloomberg terminal we're now
referring it to it as the Lag seven. But there's
some really quality names here in bear market territory. Now,
if you're willing to take a long term view, is
this the moment to get.
Speaker 4 (10:19):
In so certainly. I mean, you know, obviously we've seen
valuations come off quite dramatically, so that was always the
concern with these names was that valuations are are a
big challenge, and now that's becoming less of a concern.
They still have very strong fundamentals by and large. I think,
you know, names affiliated with Elon Musk obviously have different
(10:41):
headwinds potentially than some of the other companies. So that's
you know, that's something that you have to factor into
your decision making process. But from our perspective, we are
overweight tech looking to buy the dip in the tech
set in the US tech sector as well, so that
would fit into this mag seven rebound at some point.
Speaker 3 (11:00):
You're also overweight China. Now the market there is closed today,
but we saw some pretty modest declines yesterday compared to
what we saw in the US. What's your outbook for
China stocks?
Speaker 4 (11:11):
So, I mean, we do feel that China will probably
weaken a little bit in the in the near term.
Obviously the tariff effect. You know, they ha been pretty resilient. Obviously,
the market's done very well so far this year, so
you know, but we would be buying on dips there
as well. You know, we believe that the technology sector
in particular is an area of key interest for US.
(11:32):
You know, obviously the deep Seek revelation still feeding into
a more bullish environment for tech sector. Valuations in the
in China are pretty cheap still, so from that perspective,
we like their hang sending in decks, you know, buying
down you know, maybe three five percent there than we
are today, and the same on the tech sector as
well for the Hang Seng.
Speaker 3 (11:52):
Southeast Asia, Emerging Asia obviously as part of that channel
plus one strategy, some of the hardest.
Speaker 2 (11:57):
Hits in these tariffs. Do you still see opportunities to
use when it comes to in this region.
Speaker 4 (12:03):
So we're underweight Asian, so from you know, so we're
overweight China, underweight Assien at the moment, and I think
that's one of one of the reasons was we felt
that the China was probably better prepared for the tariffs
than maybe Asian. Obviously that China plus one strategy was
a huge boon to the region, but I think that's
something that's in the cross hairs of US policy now.
So and you know, obviously the formula being used by
(12:25):
the by the US to determine what tariff should be,
it's sort of symptomatic of that, and that's why Asian
is probably facing significant headwinds at the moment. So yeah,
it's it's it's not an area of focus for US. Obviously,
value will be created through this in our opinion if
we think that tariffs are going to be transitory or
at least not at these levels or so we were
at peak tariff's, But for us, our focus is elsewhere.
Speaker 2 (12:48):
That was Steve Bryce, chief investment officer at Standard Chartered
Wealth Management, speaking earlier with Bloomberg's Paul Allen and Heidi
Stroud Watts here on the Daybreak Asia podcast. Thanks for
listening to today's episode of the Bloomberg Daybreak Asia Edition podcast.
Each weekday, we look at the story shaping markets, finance,
(13:10):
and geopolitics in the Asia Pacific. You can find us
on Apple, Spotify, the Bloomberg Podcast YouTube channel, or anywhere
else you listen. Join us again tomorrow for insight on
the market moves from Hong Kong to Singapore and Australia.
I'm Doug Chrisner, and this is Bloomberg
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