UOB Kay Hian Private Wealth Management
30 July 2025

Global Markets Update: Trade Tensions, Earnings Surprises, and Key Investment Moves Shape the Outlook for H2 2025

Market Overview: Trade Truce Uncertainty and Tariff Threats Dominate

Geopolitical risks and trade headlines continue to steer global markets. While China announced a deal with the US to extend the tariff truce, US Treasury Secretary Scott Bessent cautioned that nothing is final without President Trump’s sign-off. S&P 500 futures remained flat in early trading, reflecting investor caution. Meanwhile, Trump signaled potential 20–25% tariffs on India and warned that EU’s 15% rate could rise if commitments remain unmet.

• S&P 500’s six-day winning streak ended, falling 0.3% as US Treasury yields dipped ahead of the Fed’s interest rate decision.
• The US dollar hit a one-month high against the euro.
• Major earnings from Microsoft, Meta, and Qualcomm are in focus, with Microsoft and Meta highlighted as core recommendations, and Qualcomm as a trading buy.
• WTI Crude hit a one-month high after Trump’s ultimatum to Russia on a Ukraine truce, paired with threats of new tariffs and secondary sanctions.
• VeriSign shares fell sharply after Berkshire’s stake sale, though the placement was oversubscribed. Berkshire remains a core recommendation, VeriSign a trading buy.
• Union Pacific’s \$72 billion bid for Norfolk Southern marks the largest railroad merger in history, potentially prompting Berkshire’s BNSF to bid for CSX Corp.
• Novo Nordisk’s sales warning triggered a sharp selloff in obesity drug makers, dragging down Eli Lilly.

Key Indices and Financial Markets Performance

Major Corporate Developments: US and Global Highlights

Apple, FedEx, Thermo Fisher Scientific, Otis Worldwide

These US corporate leaders participated in a high-level delegation to Beijing, where China’s Industry Minister reaffirmed support for foreign businesses and market access. The discussions focused on industrial policy and persistent trade and tariff challenges. Apple shares fell 1.3%, FedEx dropped 3.25%, Thermo Fisher was down 0.58%, and Otis slipped 0.68%.

Visa

Visa shares declined 2.3% in after-hours trading, despite a 5% adjusted EPS beat for Q3. The firm maintained its full-year outlook amid tariff headwinds and consumer spending concerns, with 14% year-on-year revenue growth noted. Analysts pointed to the unchanged guidance as a drag on sentiment.

Starbucks

Starbucks shares rose 4.6% after hours, as Q3 net revenue and same-store sales in China and North America exceeded estimates. Despite management’s confidence in its turnaround plan, results were described as modest.

Nvidia

Nvidia was cleared to resume shipments of its H20 AI chips to China, after the US granted export licenses to limit Chinese self-sufficiency in advanced chipmaking. The H20, Nvidia’s most capable China-eligible GPU, remains subject to prior US restrictions on compute performance. Nvidia is highlighted as a core recommendation.

Amazon

Amazon moved to dismiss a proposed class-action lawsuit regarding arsenic-contaminated rice, arguing the issue is well-known and protected under Section 230. Plaintiffs claim overpayment for tainted rice from brands including 365 and Ben’s Original. Amazon is a core recommendation.

Johnson & Johnson

Johnson & Johnson was ordered to pay \$42.6 million after a jury found its talc products caused mesothelioma. The company faces over 63,000 related lawsuits, denies the claims, and plans to appeal while phasing out talc-based products.

Booking Holdings

Booking beat Q2 estimates with \$6.8 billion in revenue, up 16% year-on-year, buoyed by strong international bookings, especially from Chinese tourists in Southeast Asia. Q3 forecasts indicate 7–9% revenue growth and 3.5–5.5% room night growth, with no tariff headwinds noted.

Uber

Uber lost its UK Supreme Court appeal, confirming that private-hire taxi operators outside London are not required to charge 20% VAT on profit margins. The decision aligns with the 2024 Court of Appeal ruling favoring Delta Taxis and Veezu, with no impact on Uber’s VAT practices.

Procter & Gamble

P&G will raise prices on 25% of its US products to offset new tariffs linked to Trump’s trade policies. The industry-wide annual loss is estimated at \$7.1–8.3 billion. Mid-single-digit price hikes face consumer resistance and inventory hoarding, potentially delaying inflation but pressuring retailers like Walmart and Amazon.

UPS

UPS missed Q2 profit estimates, earning \$1.55 per share despite beating revenue at \$21.2 billion. The company withheld full-year guidance, citing tariff-driven volume drops and macro uncertainty. Management warned of a volatile trade environment and a 34.8% decline in daily China-lane volumes due to “de minimis” tariff changes.

UnitedHealth

UnitedHealth lowered its full-year EPS guidance to at least \$16, well below expectations, citing \$6.5 billion in higher-than-planned medical costs. Shares dropped nearly 5%. The company missed Q2 estimates and does not expect profit recovery until 2026.

Boeing

Boeing beat Q2 free cash flow estimates and narrowed its loss to \$1.24 per share on \$22.75 billion in revenue. However, shares fell as MAX 7 and 10 certifications slipped to 2026. Tariff headwinds and quality concerns offset momentum in 737 and 787 deliveries.

Ambiq Micro (Arm-backed IPO)

Ambiq Micro raised \$96 million in an upsized IPO, valuing the chipmaker at \$423.3 million. The company develops ultra-low-power chips for wearables and industrial use and priced shares near the top of its range.

Berkshire Hathaway and VeriSign

Berkshire Hathaway reduced its stake in VeriSign to below the 10% regulatory threshold, driving a 9.32% drop in VeriSign shares, though the share placement was oversubscribed. Berkshire remains a core recommendation, and VeriSign is a trading buy.

Union Pacific and Norfolk Southern

Union Pacific agreed to acquire Norfolk Southern in a \$72 billion cash-and-stock deal—the largest railroad merger in history. If the deal survives regulatory review, it may prompt Berkshire’s BNSF to bid for CSX Corp.

Novo Nordisk and Eli Lilly

Novo Nordisk warned of weaker sales, causing its shares to plunge 23.11% and dragging Eli Lilly down by 5.59%.

US Macroeconomic and Political Trends

• Trump’s approval rating slipped to 40%, the lowest of his second term. Economic approval rose to 38%, and immigration to 43%, with changes within the poll’s margin of error.
• The US goods trade deficit narrowed 10.8% to \$86 billion in June, the lowest since September 2023, amid a 4.2% drop in imports and 0.6% decline in exports.
• The Atlanta Fed raised its 2Q GDP forecast to 2.9% from 2.4%, citing stronger trade data. Job openings and hiring both fell.

Greater China: Growth Hopes and Corporate Developments

IMF Upgrades Emerging Market Growth Forecast, China in Focus

The IMF raised its 2025 GDP growth forecast for emerging markets to 4.1%, from 3.7%, driven by a positive outlook on China, now expected to grow 4.8% due in part to reduced US–China tariffs. Russia and South Korea’s forecasts were downgraded, and Brazil remains vulnerable to further US tariffs.

China Internet and AI: From LLMs to Applied AI

WAIC 2025 in Shanghai marked a shift from large language models to applied AI and agents as the next growth phase. The focus is on enterprise productivity, embodied agents, and empathetic voice interfaces. The sector maintains a market weight rating.

WuXi AppTec

WuXi AppTec reported a strong 1H25, with revenue and adjusted earnings up 20.6% and 44.4% year-on-year, respectively. The company raised its 2025 revenue growth target to 13–17% and was upgraded to a buy rating, with a higher target price of HK\$146.00.

COSCO and CK Hutchison

China is pushing to add COSCO to CK Hutchison’s \$22.8 billion port sale, facing likely US opposition and years of regulatory review. French group CMA CGM expressed interest in part of the portfolio and reported Q2 revenue of \$13.2 billion and net profit of \$521 million.

Foxconn

Foxconn will suspend share trading on July 30 pending a major announcement, with market speculation focused on investment, asset sales, mergers, or strategic partnerships.

Bitmain

Chinese crypto mining giant Bitmain plans to open its first US factory by end-Q3 2025, targeting Texas or Florida for HQ and assembly. Production is slated to begin in early 2026, aiming to mitigate tariff risks and improve delivery.

Shanghai Airports and Typhoon Impact

Shanghai’s Pudong and Hongqiao airports will cancel nearly 30% of flights due to Typhoon Co-may, impacting 640 flights.

Tibet Hydropower Megaproject

China has begun construction on a \$167 billion hydropower megaproject in Tibet, expected to generate 300 terawatt-hours annually, tying into stimulus, energy, and river management goals.

Asia ex-China: Strategic Deals and Corporate Moves

Samsung and Tesla

Samsung shares rose after landing a \$16.5 billion AI chip deal with Tesla, potentially boosting its Texas factory and chipmaking business. Challenges remain in closing the gap with rivals in logic and memory chips.

Temasek and Ermenegildo Zegna

Singapore’s Temasek will increase its stake in Ermenegildo Zegna Group to 10% via a \$126.4 million share purchase, supporting the brand’s expansion and Temasek’s push into Europe.

Japan-US Trade Deal

Japan’s trade deal with the US guarantees the lowest tariff rates on chips and pharmaceuticals, with future lower rates automatically applying. The agreement includes a \$550 billion Japanese investment, and Japan is prioritizing enactment of the 15% tariff rate.

South Korea Trade Talks

Three South Korean officials met the US Commerce Secretary to push for a trade deal before 25% tariffs take effect August 1. Seoul is offering industrial cooperation to protect key exports.

Singapore Airlines

SIA reported a disappointing 1QFY26, with net profit dropping 58.8% year-on-year to S\$186 million, impacted by higher non-fuel operating costs, lower interest income, and deeper Air India losses. Earnings for FY26–28 are cut by up to 30%. The stock is downgraded to sell.

Keppel Pacific Oak US REIT

KORE saw a 3.3% rental reversion in Q2 2025, with tech firms driving 17.1% of 1H25 lease signings. Occupancy is expected to reach the mid-to-high 80% range by end-2025. Management plans a gradual payout ratio increase to 45% by 2027. The stock is rated buy.

Thailand-US Tariff Negotiations

Thailand expects to conclude trade talks with the US before the August 1 deadline, with its finance minister confident tariffs won’t exceed 36%. Concessions have been made, with expected rates in line with Vietnam’s 20% and Indonesia’s 19%.

EMEA & Other Regions: Banking, Autos, and Pharma Face Tariff Headwinds

UBS

UBS is considering a potential HQ move, with London as a top candidate, as proposed Swiss capital rules could cost an additional \$24 billion. The bank faces investor pressure over stock performance and growth.

Barclays

Barclays 1H25 profit rose 23% year-on-year to £5.2 billion, beating expectations as Trump’s tariffs fueled trading gains in equities and fixed income. The bank announced £1.4 billion in shareholder returns and remains on track with 2026 profit targets.

Stellantis

Stellantis warned of a €1.5 billion US tariff hit for 2025 but pledged new launches, such as the V8 Ram, to boost volume under new CEO Filosa. The company aims to recover and streamline brand operations, though the outlook remains vague.

Kering (Gucci)

Kering, owner of Gucci, reported a 15% year-on-year drop in quarterly sales, with Gucci down 25%, missing expectations amid weak demand and US tariffs. The group is planning price hikes and store closures to revive growth.

AstraZeneca

AstraZeneca proposed US drug price cuts as part of a \$50 billion expansion plan to ease tariff risks under Trump’s pricing push. Strong Q2 results and US demand support the company’s goal of reaching \$80 billion in annual revenue by 2030.

IPO & Event Calendar Highlights

• Sunshine Pharma (6887 HK) IPO on August 7.
• FedEx CEO leads USCBC delegation to China (Jul 27–30).
• China Politburo meeting (Jul 28–31).
• FOMC Rate Decision (Jul 29–30).
• Key earnings: Microsoft, Meta, Qualcomm, Visa, Amazon, Apple, Vale, Samsung, BMW, Chevron, ExxonMobil, Berkshire Hathaway, and more.