Thaw in US-China Trade War: Geneva Talks Begin, Four Major Sectors in the Taiwan Stock Market Preparing for Rotation

Taiwan • Business • 05/11 03:53
Thaw in US-China Trade War: Geneva Talks Begin, Four Major Sectors in the Taiwan Stock Market Preparing for Rotation

On May 10, 2025, high-level representatives from the US and China held their first formal talks in Geneva, Switzerland, in an attempt to ease economic tensions caused by punishing tariffs. The talks, led by US Treasury Secretary Besant and Chinese Vice Premier He Lifeng, lasted eight hours and are set to continue on May 11. The Taiwan stock market showed signs of capital rotation, with four major sectors likely to be affected. Ukraine and the India-Pakistan regions announced ceasefires, easing global market sentiment.

Key Updates

05/12 02:59

Director of the CBO Warns: Trump's trade policies undermine confidence in foreign investment, the status of the dollar and the sustainability of U.S. debt face challenges.

Phillip Swagel, the director of the Congressional Budget Office, stated in an interview with The Financial Times that President Trump's trade policies and tariffs have had an impact on Wall Street and could potentially affect foreign investors' confidence in U.S. assets. While a 10% tariff might reduce the deficit, its impact on market confidence and the dollar's status cannot be overlooked. With the rise in U.S. debt interest expenses, the CBO and policymakers view U.S. debt as being on an unsustainable trajectory.

05/12 01:24

The US-China trade talks wrapped up in Geneva: An agreement was reached to cut the $1.2 trillion trade deficit and set up a consultation mechanism.

On May 11, 2025, the United States and China concluded a two-day high-level economic and trade talks in Geneva, Switzerland, where they reached a consensus on several key issues. This marked the first high-level talks since President Trump imposed tariffs on Chinese goods earlier this year. The agreement aims to reduce the U.S. trade deficit by $1.2 trillion and establish a mechanism for U.S.-China economic and trade consultations. Both parties are set to release a joint statement on May 12, detailing the agreement.

05/11 22:55

The US and UK Reach a New Tariff Agreement, Talks Between the US, China, and Switzerland Begin: A Ray of Hope for the Global Trade Situation

In May 2025, the United States and the United Kingdom reached a bilateral trade agreement under a new tariff policy, which grants tariff reductions for British-made automobiles and steel products, reducing the base tariff to 10%. U.S. and Chinese officials met in Geneva, Switzerland, agreeing to set up a mechanism for economic and trade consultations, and a joint statement will be released on May 12. Market sentiment remains optimistic, U.S. Treasury yields have remained stable, and the Federal Reserve kept interest rates unchanged at its May 7 meeting, with the benchmark rate range at 4.25% to 4.50%.

05/11 18:25

Trump's announcement of a 145% tariff sparks market volatility, as U.S. inflation data indicates rising trends.

On April 2, 2025, U.S. President Donald Trump announced a 145% tariff on Chinese imports and threatened to take similar measures against Mexico, the EU, and other countries, leading to global market turmoil and sparking domestic controversy in the United States. April U.S. inflation data showed an estimated 0.3% increase in core CPI, indicating the potential impact of the tariff policy on prices. This policy, led by Trump's economic advisory team, aims to bring manufacturing back to the United States and act as leverage in trade negotiations.

05/11 14:25

An Experiment by American Small Business Owners Reveals Consumer Willingness to Pay High Prices for "Made in USA" Products: Results That Give Food for Thought

Afina Showerhead Filter founder Ramon van Meer tested if consumers are willing to pay more for products "Made in USA" amid US-China trade tensions. He sold two identical products on his website, one priced at $129 made in China and the other at $239 made in the USA. The results showed that 584 customers opted for the China-made version, while no one purchased the USA-made version, indicating that consumers are not willing to pay extra to support American manufacturing. Van Meer plans to shift production to other Asian countries to cut costs.

05/11 03:53

Thaw in US-China Trade War: Geneva Talks Begin, Four Major Sectors in the Taiwan Stock Market Preparing for Rotation

On May 10, 2025, high-level representatives from the US and China held their first formal talks in Geneva, Switzerland, in an attempt to ease economic tensions caused by punishing tariffs. The talks, led by US Treasury Secretary Besant and Chinese Vice Premier He Lifeng, lasted eight hours and are set to continue on May 11. The Taiwan stock market showed signs of capital rotation, with four major sectors likely to be affected. Ukraine and the India-Pakistan regions announced ceasefires, easing global market sentiment.

05/10 15:02

Donald Trump's new tariff policies spark volatility in the U.S. Treasury bond market: 30-year Treasury yield jumps 50 basis points within a week

In April 2025, the U.S. Treasury bond market experienced significant volatility due to a new round of high tariff policy announced by Trump on April 2. The 30-year Treasury yield surged nearly 50 basis points in a single week, marking the largest increase since 1987. Perry, the manager of SOMA at the New York Federal Reserve Bank, pointed out that the large-scale closing of "swap spread trades" by leveraged investors was one of the primary reasons for the abnormal spike in yields. The Trump administration subsequently delayed some of the tariff measures, and the Federal Reserve increased liquidity support to stabilize the market.

05/10 11:29

Sino-American trade talks in Geneva halted: Chinese delegation abruptly withdrew from the venue

On May 10, 2025, high-level economic and trade negotiations between the US and China were held in Geneva, Switzerland. The Chinese delegation abruptly left the venue, causing the talks to be interrupted, and the US representatives subsequently left as well. This meeting marked the first formal engagement between the two sides since the escalation of high-tariff tensions, aimed at finding a way to ease tensions. Both parties had previously expressed openness to dialogue, but the sudden turn of events cast doubt on the future of the negotiations.

05/10 07:29

Impact of Trump's 2025 Tariff Policy on U.S. Supermarkets: Costco's Five Major Imported Food Prices Face Pressure

In April 2025, President Trump of the United States announced the imposition of a minimum tariff of at least 10% on all imported goods, and punitive tariffs of up to 145% on products from specific countries, leading to global trade upheaval. This policy is intended to revitalize American manufacturing but has triggered price fluctuations in the U.S. retail market. Five key categories of imported foods at Costco—grains, coffee, wine, cheese, and cooking oil—have been severely impacted, resulting in price increases. This article examines the specific effects on these products and the market's reaction.

05/10 02:00

The US-UK Trade Agreement and the US-China Negotiations Boost Market: Oil Prices and Tesla Stock Rise, and Gold Climbs Due to a Weakened Dollar

On May 10, 2025, US-China high-level trade negotiations took place in Geneva, and the US and UK reached a bilateral trade agreement, enhancing market confidence. Oil prices rose, driven by trade optimism and Middle Eastern tensions, while Tesla's stock price rebounded thanks to tariff reductions and advancements in its self-driving taxi program. Gold prices rose due to the weakening dollar and geopolitical risks. This article examines how these events affect oil prices, Tesla's stock price, and gold prices.

US-China High-Level Talks Begin, Geneva in the Spotlight

According to reports from AFP and Xinhua News Agency, on May 10, the US and China commenced a two-day trade talks in Geneva. This marks the first face-to-face negotiations since President Trump returned to the White House in January 2025. The US delegation includes Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, while the Chinese side is led by Vice Premier He Lifeng, accompanied by Minister of Public Security Wang Xiaohong, indicating China's emphasis on the talks.

The meeting is held at the residence of the Swiss Ambassador to the United Nations, in a low-key and private setting. The talks began in the morning local time, met again after lunch, and lasted about eight hours in total. Although no statements were made to the public, President Trump mentioned on social media that the talks were "friendly and constructive," and that both sides have "fully restarted" negotiations.

Tariff Issues at the Core, Differences Remain

The core issue of the talks is bilateral punitive tariffs. Since the US-China trade war escalated in early April, the US has imposed tariffs as high as 145% on Chinese goods, with China responding with retaliatory tariffs of 125%, resulting in a near standstill in bilateral trade. Trump recently proposed on social media reducing tariffs to 80%, which, although still higher than previous levels, is seen as a symbolic concession.

White House spokesperson Caroline Levitt stressed that the US will not unilaterally lower tariffs unless China makes substantial concessions. Meanwhile, China stated through Xinhua that the talks are "an important step towards resolving disputes," but insisted on the US canceling punitive tariffs and the "reciprocal tariffs" announced on April 2.

Taiwan Stock Market Reaction, Four Major Sectors May Rotate

As international tensions slightly ease, signs of capital rotation have emerged in the Taiwan stock market. According to financial expert Ruan Muhua, with the US-China talks underway, the Taiwan stock market may see a rotation among four major sectors next week:

  1. AI and Cloud Server-Related Industries: Benefiting from the upcoming COMPUTEX 2025 exhibition, AI servers, CoWoS, silicon photonics, and AI software sectors are receiving attention.
  2. Small and Medium-Sized Thematic Stocks: With blue-chip stocks stabilizing, the OTC index is catching up, and funds may shift to small and medium-sized stocks with clean balance sheets and cleared financing.
  3. 520 Policy Concept Stocks: As the 520 presidential inauguration approaches, policy-benefiting sectors such as green energy (solar), military, heavy electrical, next-generation communications, and tourism are in focus.
  4. Export-Oriented Industries: The Taiwan dollar has recently appreciated by 4.5%, marking the largest weekly gain since 1988, which may affect the competitiveness and capital flow of export-oriented industries.

Additionally, market observers note that industries highly related to tariff policies, such as semiconductors and electronic components, need to closely monitor the progress of US-China negotiations in the short term.

International Tensions Ease, Ukraine and India-Pakistan Announce Ceasefire

In addition to US-China trade talks, recent geopolitical developments show signs of easing. Ukrainian President Zelensky announced an unconditional 30-day ceasefire starting May 12, with support from the US and several European countries. Russian President Putin expressed a willingness to resume direct negotiations but did not clearly state whether he would accept the ceasefire conditions.

Meanwhile, India and Pakistan, under US mediation, also announced an immediate comprehensive ceasefire. President Trump stated on social media that this is a decision that "demonstrates common sense and wisdom," emphasizing that the US will continue to work towards peace and stability in the region.

These ceasefire announcements positively impacted global market sentiment, providing a breather for investors amid recent multiple geopolitical conflicts and trade tensions.

References

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