1 00:00:00,160 --> 00:00:01,680 Speaker 1: Right now, it is time to have a look at 2 00:00:01,680 --> 00:00:05,359 Speaker 1: Trump's tariffs. He's fired as shots on trade. All countries 3 00:00:05,400 --> 00:00:09,040 Speaker 1: get ten percent, the EU cops twenty percent. Asia hit 4 00:00:09,119 --> 00:00:11,559 Speaker 1: quite hard. Here are the numbers for you. China thirty 5 00:00:11,600 --> 00:00:15,560 Speaker 1: four percent, Vietnam forty six percent, Taiwan gets thirty two, 6 00:00:15,720 --> 00:00:20,439 Speaker 1: Japan twenty four, South Korea twenty five, Thailand thirty six, 7 00:00:20,600 --> 00:00:25,880 Speaker 1: Indonesia thirty two, Malaysia twenty four, Cambodia forty nine. Sam 8 00:00:25,880 --> 00:00:29,920 Speaker 1: Dicky is Fisher Funds, He's with US Hi Sam good 9 00:00:29,920 --> 00:00:32,199 Speaker 1: eaving right now. The fact that Asia has been hit 10 00:00:32,280 --> 00:00:35,000 Speaker 1: so hard, I mean that has implications for US, given 11 00:00:35,000 --> 00:00:37,239 Speaker 1: how much trade we do there. But in terms of 12 00:00:37,320 --> 00:00:40,080 Speaker 1: market reaction today, that's where we've seen the biggest reaction, 13 00:00:40,200 --> 00:00:40,519 Speaker 1: is it not? 14 00:00:42,159 --> 00:00:45,159 Speaker 2: That's right, Well, sort of two to three percent falls 15 00:00:45,159 --> 00:00:49,440 Speaker 2: in the US markets after close and Asian markets like 16 00:00:50,120 --> 00:00:53,200 Speaker 2: you know, the Neckeye in Japan down three percent, Vietnam 17 00:00:53,360 --> 00:00:56,320 Speaker 2: down sort of four or five percent, whereas good on 18 00:00:56,360 --> 00:00:57,840 Speaker 2: New Zealand as dead flat on the day. 19 00:00:58,800 --> 00:01:01,320 Speaker 1: And are you is this what you were expecting? Were 20 00:01:01,360 --> 00:01:02,760 Speaker 1: you expecting them to be worse than this? 21 00:01:04,280 --> 00:01:04,360 Speaker 3: No? 22 00:01:04,480 --> 00:01:06,800 Speaker 2: I think, I mean the market generally was expecting sort 23 00:01:06,840 --> 00:01:09,200 Speaker 2: of a global tariff of twenty percent, and I think 24 00:01:09,240 --> 00:01:11,440 Speaker 2: the market was expecting it to be more uniform. So 25 00:01:11,920 --> 00:01:14,120 Speaker 2: the fact that it's a twenty nine percent weighted average 26 00:01:14,160 --> 00:01:17,360 Speaker 2: tariff around the world is worse. And the fact that 27 00:01:17,520 --> 00:01:21,880 Speaker 2: so non uniform was quite a surprise as well. 28 00:01:22,040 --> 00:01:24,800 Speaker 1: So that's a good thing because the market's obviously, well, 29 00:01:24,800 --> 00:01:27,160 Speaker 1: they were pricing in something bad happening over the last 30 00:01:27,160 --> 00:01:29,440 Speaker 1: couple of weeks, weren't they. So is this is this 31 00:01:29,560 --> 00:01:31,640 Speaker 1: sort of a bit of a sigh of relief. 32 00:01:33,000 --> 00:01:37,000 Speaker 2: Well, I think when the big news event that everyone's 33 00:01:37,000 --> 00:01:40,280 Speaker 2: expecting comes to pass, you do start to get some 34 00:01:40,640 --> 00:01:41,399 Speaker 2: sign of relief. 35 00:01:41,400 --> 00:01:43,480 Speaker 3: But to be clear, this was worse than expected. 36 00:01:43,560 --> 00:01:46,920 Speaker 2: This is twenty nine percent versus twenty percent expected, despite 37 00:01:46,920 --> 00:01:49,880 Speaker 2: the fact that markets have been weak, and as you said, 38 00:01:49,920 --> 00:01:54,960 Speaker 2: it's been disproportionately negative to Asia, but especially Southeast Asia. 39 00:01:55,080 --> 00:01:58,400 Speaker 2: You know, Vietnam, Cambodia, some of those countries have been 40 00:01:58,480 --> 00:02:00,640 Speaker 2: hit with sort of forty five fifty percent tariffs. So 41 00:02:00,640 --> 00:02:04,400 Speaker 2: that's definitely worse than expected, and that has flow on 42 00:02:04,440 --> 00:02:07,400 Speaker 2: impacts as well, because there's a lot of product that 43 00:02:08,200 --> 00:02:10,280 Speaker 2: is manufactured in those countries and a lot of product 44 00:02:10,280 --> 00:02:14,080 Speaker 2: that's been diversified out of China. So people have been 45 00:02:14,080 --> 00:02:16,320 Speaker 2: trying to diversify their supply chains away from China and 46 00:02:16,360 --> 00:02:19,280 Speaker 2: they've chosen Southeast Asia as the next best option. 47 00:02:20,480 --> 00:02:23,960 Speaker 1: Right, So this is actually, I mean, yeah interesting. And 48 00:02:24,000 --> 00:02:26,600 Speaker 1: I was looking at Vietnam today. They I think it's 49 00:02:26,600 --> 00:02:29,760 Speaker 1: about thirty percent of you know, more than one hundred 50 00:02:29,800 --> 00:02:32,160 Speaker 1: billion dollars of what they produced goes to the United 51 00:02:32,160 --> 00:02:35,520 Speaker 1: States and they've been hit with what was it forty 52 00:02:35,560 --> 00:02:38,480 Speaker 1: six percent. I mean, that's that's for that kind of country. 53 00:02:38,480 --> 00:02:39,880 Speaker 1: That's pretty crippling, isn't it. 54 00:02:41,200 --> 00:02:41,639 Speaker 3: That's right. 55 00:02:41,760 --> 00:02:43,560 Speaker 2: But I mean, you know, we had been here in 56 00:02:43,600 --> 00:02:47,560 Speaker 2: the last few days that Vietnam had been feverishly trying to, 57 00:02:48,400 --> 00:02:50,480 Speaker 2: you know, walk back some of the tariffs it had 58 00:02:50,520 --> 00:02:52,920 Speaker 2: on US goods imported into its country. 59 00:02:52,919 --> 00:02:55,400 Speaker 3: You hear to this, but I guess, you know, too little, 60 00:02:55,400 --> 00:02:56,239 Speaker 3: too late at the stage. 61 00:02:56,240 --> 00:02:58,240 Speaker 2: But this is going to be critical to watch in 62 00:02:58,280 --> 00:03:01,040 Speaker 2: the coming days and weeks, is do some of these 63 00:03:01,040 --> 00:03:05,040 Speaker 2: countries back down reduce the tariffs on US imported goods, 64 00:03:05,040 --> 00:03:07,760 Speaker 2: which will in turn allow the US to back down 65 00:03:07,800 --> 00:03:10,160 Speaker 2: and lower the reciprocal tariffs. 66 00:03:10,800 --> 00:03:13,920 Speaker 1: Now, let's talk about some new Zealand stocks for example, 67 00:03:14,040 --> 00:03:16,320 Speaker 1: I mean the likes of Fisher and Pike or what 68 00:03:16,520 --> 00:03:20,679 Speaker 1: happens with them. What did you any carve outs or 69 00:03:20,680 --> 00:03:23,920 Speaker 1: workarounds for these types of businesses from what you heard today. 70 00:03:24,600 --> 00:03:27,080 Speaker 3: Yeah, Fish and Pocal Healthcare super interesting. 71 00:03:27,160 --> 00:03:28,919 Speaker 2: Had a bit of a rollercoaster day, down as much 72 00:03:28,919 --> 00:03:32,160 Speaker 2: as seven percent at one stage, but encourage encouraging me 73 00:03:32,400 --> 00:03:34,480 Speaker 2: finished up on the day, and a couple of reasons 74 00:03:34,480 --> 00:03:36,480 Speaker 2: for that. The first is stock had been a bit 75 00:03:36,520 --> 00:03:41,040 Speaker 2: soft running into this and anticipation. But much more importantly, 76 00:03:41,240 --> 00:03:44,800 Speaker 2: while New Zealand was slapped with a ten percent tariff, Mexico, 77 00:03:45,280 --> 00:03:48,600 Speaker 2: where FPH manufactures about sixty percent of the product that 78 00:03:48,640 --> 00:03:52,160 Speaker 2: goes into the US, did not receive any incremental tariffs 79 00:03:52,360 --> 00:03:55,440 Speaker 2: and above the twenty five percent tariff it got earlier. 80 00:03:55,440 --> 00:03:59,920 Speaker 2: But most importantly, the White House confirmed that products manufact 81 00:04:00,280 --> 00:04:03,960 Speaker 2: in Mexico that are compliant with the US Canada Mexico 82 00:04:04,000 --> 00:04:07,560 Speaker 2: Trade Agreement will have zero tariffs, and almost all of 83 00:04:07,680 --> 00:04:13,320 Speaker 2: fph's products and Mexico is compliant. So that was really important. 84 00:04:13,360 --> 00:04:15,119 Speaker 2: And I've got to say, you know, we've been looking 85 00:04:15,120 --> 00:04:17,120 Speaker 2: at a lot of companies around the world today and how. 86 00:04:16,960 --> 00:04:18,640 Speaker 3: They've reacted to this and what they've said. 87 00:04:19,240 --> 00:04:22,080 Speaker 2: It was an absolute breath of fresh air to see 88 00:04:22,120 --> 00:04:25,039 Speaker 2: the clarity that if pH gave the stop market with 89 00:04:25,080 --> 00:04:27,240 Speaker 2: their release, and that's quite rare globally. 90 00:04:27,839 --> 00:04:29,640 Speaker 1: Yeah, well they would be one of the lucky ones, 91 00:04:29,640 --> 00:04:31,080 Speaker 1: wouldn't they the lucky few? 92 00:04:31,800 --> 00:04:33,359 Speaker 2: What is all of this? Well, not so much the 93 00:04:33,440 --> 00:04:37,120 Speaker 2: lucky few, but it's just the clarity with which they 94 00:04:38,040 --> 00:04:40,080 Speaker 2: put in that release, and that gave the clarity to 95 00:04:40,160 --> 00:04:41,560 Speaker 2: investors that that's quite rare. 96 00:04:41,600 --> 00:04:44,480 Speaker 3: So I think that's right. And listen for other companies 97 00:04:44,520 --> 00:04:45,159 Speaker 3: around the world. 98 00:04:46,040 --> 00:04:52,479 Speaker 1: What does all of this mean for investors. 99 00:04:50,080 --> 00:04:52,599 Speaker 3: Well, we're two from here. I think is critical. 100 00:04:52,640 --> 00:04:55,200 Speaker 2: So I always think, and this is a bit of 101 00:04:55,240 --> 00:04:58,479 Speaker 2: a fraud exercises trying to understand why is Trump doing this? 102 00:04:58,600 --> 00:05:01,560 Speaker 2: But if we take them at value, it's important and 103 00:05:01,640 --> 00:05:03,320 Speaker 2: it helps us begin to understand. 104 00:05:03,000 --> 00:05:03,560 Speaker 3: The in game. 105 00:05:03,680 --> 00:05:08,159 Speaker 2: So ostensibly it is to reduce the persistent US trade deficits. 106 00:05:08,200 --> 00:05:10,400 Speaker 2: It is to return manufacturing too the US, and it 107 00:05:10,440 --> 00:05:13,080 Speaker 2: is to serve as a bargainingship to drive lower tariffs 108 00:05:13,560 --> 00:05:16,320 Speaker 2: on US goods important into other countries. So if any 109 00:05:16,360 --> 00:05:20,440 Speaker 2: of those things start happening, we could see an easing 110 00:05:20,640 --> 00:05:22,239 Speaker 2: of this pretty draconian policy. 111 00:05:22,279 --> 00:05:24,400 Speaker 3: So that's the first point. 112 00:05:24,440 --> 00:05:27,120 Speaker 2: The second point is there's a bit of water to 113 00:05:27,120 --> 00:05:30,839 Speaker 2: go unto the bridge here that these tariffs weren't uniform. 114 00:05:31,120 --> 00:05:33,600 Speaker 2: And take Apple. Apple is a great case in point. 115 00:05:33,839 --> 00:05:38,640 Speaker 2: It was down sort of seven percent after market, not 116 00:05:38,760 --> 00:05:41,080 Speaker 2: only because it gets hit harder than expected on its 117 00:05:41,080 --> 00:05:44,680 Speaker 2: manufacturing in China, but perversely it also gets hit harder 118 00:05:44,720 --> 00:05:48,279 Speaker 2: than expected on the manufacturing it had moved to Southeast 119 00:05:48,320 --> 00:05:53,920 Speaker 2: Asia and India to diversify away from China. So I 120 00:05:53,920 --> 00:05:57,120 Speaker 2: think two points there. If we see those two things 121 00:05:57,120 --> 00:05:59,440 Speaker 2: happen that Trump wants, then we could see and easy 122 00:05:59,480 --> 00:06:03,560 Speaker 2: of this policy. But secondly, there's a bit of a 123 00:06:03,600 --> 00:06:05,560 Speaker 2: bit of uncertain water to go unto the bridge for 124 00:06:05,600 --> 00:06:08,560 Speaker 2: some of these companies where where they make decisions about 125 00:06:08,800 --> 00:06:10,240 Speaker 2: where to manufacture in the future. 126 00:06:10,680 --> 00:06:12,880 Speaker 1: Let's hope it doesn't last too long. Sam, thank you 127 00:06:13,040 --> 00:06:15,040 Speaker 1: very much for being with me tonight, Sam Dicky from 128 00:06:15,080 --> 00:06:15,880 Speaker 1: Fisher Funds. 129 00:06:16,480 --> 00:06:19,640 Speaker 2: For more from Heather Duplessy Allen Drive, listen live to 130 00:06:19,760 --> 00:06:22,760 Speaker 2: news talks. It'd be from four pm weekdays, or follow 131 00:06:22,800 --> 00:06:24,560 Speaker 2: the podcast on iHeartRadio.