Trump's Tariff Policy on China Causes Market Turmoil: Meta's Ad Revenue Expected to Decrease, Tesla's Stock Price Rises, IBM's Financial Report Draws Attention

Taiwan • Business • 04/23 01:59
Trump's Tariff Policy on China Causes Market Turmoil: Meta's Ad Revenue Expected to Decrease, Tesla's Stock Price Rises, IBM's Financial Report Draws Attention

On April 23, 2025, U.S. President Donald Trump imposed a 145% tariff on Chinese goods, leading to global market fluctuations. Meta is projecting a $7 billion decrease in revenue due to reduced advertising spending by Chinese retailers. Tesla CEO Elon Musk announced a reduction in his involvement with government efficiency matters, resulting in a 4% increase in Tesla's after-hours stock price. The White House received tariff agreement proposals from 18 countries and is in talks with 34 countries. IBM released its financial report, with market attention on the impacts of its AI initiatives and tariffs. Dow futures rose by 500 points on expectations of easing trade tensions, indicating a stabilization in investor sentiment.

Key Updates

04/24 07:04

Hong Kong's economic growth forecast for 2025 has been downgraded to 1.5% due to the impact of the US-China tariff war and geopolitical tensions.

In 2025, financial institutions such as HSBC, OCBC, and Shanghai Commercial Bank lowered Hong Kong's economic growth forecast to between 1.5% and 1.9%, mainly due to the impact of the US-China tariff war and rising geopolitical risks affecting exports and fixed investments. As an international re-export trade hub, Hong Kong faces economic pressure from intensifying global trade tensions. Some institutions, like DBS Hong Kong and Bank of East Asia, are taking a wait-and-see approach, waiting for more data to determine whether to adjust their forecasts.

04/23 21:29

Federal Reserve's Report: U.S. Businesses Shifting Costs to Consumers Under the New Tariff Policy

The Beige Book, released by the Federal Reserve Board on April 23, 2025, indicates that U.S. businesses are experiencing cost pressures due to a new round of tariff measures and have started passing these costs onto consumers. Manufacturers and retailers are responding by increasing prices and imposing additional fees. While the ability to pass on costs varies depending on company size and industry, the overall trend shows that tariff policies are impacting consumer price structures.

04/23 15:02

Due to U.S. tariff policies, Kerry Photonics is expanding into Mexico and Canada, transforming the automotive supply chain.

Taiwanese automotive electronics giant Kerry Optoelectronics Co., Ltd., in response to the U.S. imposing a 25% tariff on imported cars and components, announced it will establish bases in Mexico and Canada over the next three to four years to strengthen partnerships with car manufacturers in Europe, the U.S., and Japan. This move is intended to circumvent high tariffs and directly supply to local car manufacturers, increasing the chances of becoming a Tier 1 supplier, marking a pivotal moment in its global expansion strategy.

04/23 07:06

Taiwan-U.S. trade talks focus on taxes on alcohol and goods: The U.S. is calling for transparency and fair competition in the system

After President Trump of the United States announced a 32% reciprocal tariff rate on Taiwan, trade negotiations between Taiwan and the U.S. have heated up, with alcohol taxes emerging as a central issue. The U.S. questions the differing tax standards for imported and local alcoholic beverages in Taiwan, calling for transparency and fair competition. Taiwan's Ministry of Finance provided import data to support the negotiations. Local netizens are skeptical about whether tax reductions will be reflected in consumer prices and are worried about potential monopolies by middlemen.

04/23 05:59

The American automotive industry opposes the 25% tariff on auto parts, highlighting the appeal of Chinese manufacturing as consumers shift to buying from China.

In April 2025, six major organizations in the U.S. automotive industry, including the Alliance for Automotive Innovation, jointly sent a letter to the Trump administration, requesting the repeal of the 25% tariff on auto parts that went into effect on May 3, warning that this move would severely damage the supply chain. Due to rising car prices, American consumers have initiated a "reverse purchasing" trend, traveling to China to purchase goods, highlighting the price and quality competitiveness of Chinese manufacturing. This situation reflects shifts in the global supply chain and consumer market.

04/23 01:59

Trump's Tariff Policy on China Causes Market Turmoil: Meta's Ad Revenue Expected to Decrease, Tesla's Stock Price Rises, IBM's Financial Report Draws Attention

On April 23, 2025, U.S. President Donald Trump imposed a 145% tariff on Chinese goods, leading to global market fluctuations. Meta is projecting a $7 billion decrease in revenue due to reduced advertising spending by Chinese retailers. Tesla CEO Elon Musk announced a reduction in his involvement with government efficiency matters, resulting in a 4% increase in Tesla's after-hours stock price. The White House received tariff agreement proposals from 18 countries and is in talks with 34 countries. IBM released its financial report, with market attention on the impacts of its AI initiatives and tariffs. Dow futures rose by 500 points on expectations of easing trade tensions, indicating a stabilization in investor sentiment.

04/22 22:31

The US and India accelerate trade negotiations, the Asian markets react to the dollar's depreciation, the Chinese funds adjust their asset allocations.

In April 2025, U.S. Vice President Vance visited India, and after meeting with Prime Minister Modi, the two sides made significant progress in trade negotiations, aiming to finalize a preliminary agreement before the fall to prevent India from facing a 26% tariff. The U.S. dollar index has depreciated by more than 9% since the start of the year, while the Korean won and Indonesian rupiah have also weakened, raising concerns in the market about capital outflows and potential U.S. retaliation. Chinese public mutual funds have decreased their holdings in U.S. stocks while increasing their investments in A-shares and Hong Kong stocks as part of a risk management strategy in response to uncertainties in U.S. policies.

04/22 20:59

American CEOs Addressing 2025's High Tariffs: Using Policy Loopholes to Cut Costs

In 2025, after the Trump administration returned to office, it reimposed high tariffs on imported goods. CEOs of American companies adopted various strategies to cope, including lobbying the government for exemptions and taking advantage of loopholes in foreign trade zones and gray market activities. These actions highlighted the ambiguities in policy implementation and demonstrated the companies' adaptability in response to the restructuring of global supply chains. Companies also influenced policy through political donations and considered nearshoring production and establishing factories directly in the U.S. to reduce the impact of tariffs.

04/22 19:02

Donald Trump's recent tariff policy raises investor worries: Startups face major challenges

Former U.S. President Trump, during his second term in office, pushed for a new round of tariff policies, imposing tariffs as high as 145% on Chinese goods and closing the duty-free loophole for small packages, putting pressure on the venture capital industry and startups. These policies disrupted the global supply chain, impacting fundraising, product pricing, and market expansion, undermining investment confidence, delaying plans for IPOs, and potentially causing some startups to close. Venture capital firms have adjusted their strategies by extending investment cycles and shifting to secondary market transactions, while some industries, such as AI and nearshore manufacturing, remain attractive.

04/22 18:32

*The Wall Street Journal* has criticized Trump's tariffs policy as the largest economic blunder in decades, shaking global market confidence.

In April 2025, The Wall Street Journal criticized former President Trump's tariff policy as the biggest economic blunder in decades, arguing that its instability has undermined global market confidence. Trump's attempts to meddle with the Federal Reserve and his trade war strategy have sparked a crisis of confidence in capital markets, jeopardizing U.S. financial stability. Japanese investors have engaged in a massive sell-off of U.S. bonds, indicating a significant loss of confidence among foreign investors. Experts warn that the tariffs could lead to stagflation in the U.S. economy and advise Trump to end the tariff offensive to stabilize the market.

Trump Imposes 145% Tariff on Chinese Imports

According to reports from Yahoo News and HuffPost, U.S. President Trump has recently imposed tariffs as high as 145% on Chinese imports in response to China's trade practices and the fentanyl issue. China responded with a 125% retaliatory tariff. Although Trump stated that this high tariff "won't last long" and will "drop significantly," formal U.S.-China trade talks have yet to start.

White House spokesperson Karoline Leavitt noted that the Trump administration has received proposals from 18 countries regarding tariff agreements and plans to hold talks with 34 countries. She emphasized, "The President and the administration are paving the way for an agreement with China." Treasury Secretary Scott Bessent also mentioned at an investor meeting that the trade stalemate with China is "unsustainable" and is expected to ease.

Meta's Ad Revenue May Drop by $7 Billion

According to reports from CNBC and Anue, MoffettNathanson analysis indicates that Trump's high tariff policy on China has led Chinese retailers like Temu and Shein to significantly cut their advertising spending on Meta's Facebook and Instagram. Meta's revenue from China in 2024 is expected to reach $18.35 billion, accounting for over 11% of total revenue. Analysts estimate that if the trend continues, Meta's ad revenue may decrease by $7 billion this year.

The report noted that Temu has begun reducing its advertising budget in the U.S. market, and its ranking in the Apple App Store has also declined. Analysts stressed, "The importance of China to Meta's business cannot be underestimated." If trade tensions escalate and trigger a recession, Meta's ad revenue loss in 2025 could expand to $23 billion, with profits potentially dropping by 25%.

Tesla Stock Rises After Musk's Remarks

Tesla released its first-quarter 2025 financial results on April 22. Despite revenue and profits falling short of market expectations, with automotive revenue down 20% year-over-year, CEO Elon Musk mentioned during the earnings call that he would significantly reduce his involvement in the "Department of Government Efficiency" (DOGE) starting in May. Following this statement, Tesla's stock price rose more than 4% in after-hours trading.

According to Anue, the market interpreted Musk's shift of focus back to Tesla's operations as a positive signal for the company, which has been facing recent challenges.

IBM Earnings Focus on AI and Tariff Impact

IBM is set to announce its first-quarter 2025 financial results on April 23. According to reports from TipRanks and The Globe and Mail, the market expects IBM's revenue for the quarter to be $14.39 billion, slightly down from the same period last year, with an estimated earnings per share of $1.42, down over 15% year-over-year. Analysts are focusing on IBM's progress in the AI field and the sales performance of the new generation Z series mainframes.

A Morgan Stanley analyst noted that IBM's software division performed well, contributing $27.1 billion in revenue in 2024, accounting for 43% of total revenue. However, the firm also lowered IBM's EPS estimates for the next two years by 15% to 18% to reflect slower growth and tariff pressures.

Dow Futures Rise 500 Points as Market Sentiment Stabilizes

After Trump hinted at a possible tariff reduction, market sentiment noticeably stabilized. According to reports from Anue and CBS News, the Dow Jones Industrial Average rose 1,016.57 points on the 22nd, closing at 39,186.98 points, a gain of 2.66%. The S&P 500 and Nasdaq indices rose by 2.51% and 2.71%, respectively. Dow futures also rose by 500 points.

Treasury Secretary Bessent mentioned at a JPMorgan investor meeting that the trade war with China "will ease" and said that signing a similar agreement within two to three years would be a "huge victory." These remarks pushed stocks related to China higher, with the iShares China Large-Cap ETF (FXI) and iShares MSCI China ETF (MCHI) both rising over 3%.

References

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