UBS On-Air: Market Moves

Hear from top portfolio managers and business heads from UBS Asset Management’s Muni, Taxable Fixed Income, and Liquidity teams. They share views on the markets and what they believe you should be focused on within the fixed income space.

Equity markets reacted to social media posts from US President Trump. Trump is often more coherent on social media than in off-the-cuff comments, and these remarks made clear an intention to hike taxes—US buyers will need 25% more cash to buy goods from Canada or Mexico, and another 10% cash to buy from China. The China threat is credible, and in line with our expectations. Markets are not inclined to believe the threats to tariff goods from Canada and Mexico.

US President Trump confused investors by appearing to delay taxing US consumers of Mexican and Canadian goods. The White House then “clarified” that the tax delay was not decided. Such taxes would be very visible to US consumers, at a time when Trump’s approval ratings on the economy and inflation have fallen, making repeated retreats likely.

On this week’s episode of Viewpoints, Burkhard explains how and why market activity (and performance) has started to shift from the US to the rest of the world this year, and how investors should consider positioning their portfolios accordingly.

Many investors want to know the possibility of changes to federal income tax policies, and what the changes might mean for their personal tax burden. However, it's not just the future of taxes and tax policy that matters, it's where your income level falls along the income brackets that ultimately matters. We identify where you can focus your attention so that you can better manage your lifetime tax burden and discuss strategies to help you improve your after-tax wealth potential. Featured are Justin Waring, Total Wealth Strategist, and Ainsley Carbone, Retirement Strategist, UBS Chief Investment Office. Host: Daniel Cassidy

US equity markets were a little disturbed by a sharp decline in a consumer confidence survey—but these surveys are distorted by partisan politics. Depending on the cable news network one watches, the US is either an unpleasant version of Panem from “The Hunger Games” or a Panglossian paradise where all is for the best in this best of all possible worlds. Clear economic signals are hardly likely to come from economic surveys in such a situation.

US President Trump repeated their intention to aggressively tax US consumers of goods from Canada and Mexico, starting next week. Markets do not entirely believe Trump. Taxing everyday essentials like propane gas and avocado on toast would be very visible, very quickly to US consumers. Polls suggest only 32% of US voters approve of Trump’s management of inflation.

Jason Draho, Head of Asset Allocation Americas at UBS Chief Investment Office, dives into the macroeconomic debate of whether a Trump policy put is more likely than a policy error in 2025. He evaluates the recent selloff in U.S. equity markets and assesses indicators like retail sales. The conversation then shifts to Germany’s election outcomes, examining how a new coalition may affect fiscal spending and market stability. Finally, he offers insights on navigating current market uncertainties and the outlook for equity investments.

As with many other elections in the past 12 months, the Germans voted against their incumbent government. The CDU’s Merz is expected to become the next chancellor (coalition negotiations typically take months). After the results, Merz compared US election interference to that of Russia, and suggested that Europe would need to become independent of US security.

Against the backdrop of a potential shutdown of the US government next month, Shane updates us on a range of priorities being addressed by Congress. We also update on the status of remaining cabinet-level confirmation hearings, along with ongoing negotiations for a Russia-Ukraine war resolution. Featured is Shane Lieberman, Senior Governmental Affairs Advisors, Governmental Affairs US. Host: Daniel Cassidy