The high-stakes state summit between Presidents Donald Trump and Xi Jinping in Beijing concluded last week. The meeting delivered a heavy dose of managed diplomacy, structural resets, and tactical trade arrangements. It also consolidated the floor under US-China relations, with new frameworks for trade and investment offering the prospect of future tariff reductions—though implementation risks remain and no structural breakthroughs were achieved. Markets quickly reversed their initial optimism: Chinese equities and semiconductor stocks gave back early gains once it became apparent that headline announcements would not translate into immediate tangible short-term benefits. China refrained from escalating on rare earth exports, preserving leverage for future negotiations and reasserting its preference for limiting US influence in Asian affairs. While China’s stance on Taiwan was not firmer than in the past, its opposition to US intervention remains clear. President Trump remains in strategic ambiguity on the island. The “clock is ticking” on the Iran conflict—an urgent but unspoken risk between the two nations. With three new presidential encounters ahead and unresolved issues on tariffs and technology, we remain invested but vigilant. The Board of Trade framework and Boeing orders provide near-term market narrative support, but the status quo on tariffs, the Taiwan ambiguity, and the unresolved chip/rare earth dynamics mean the risk distribution remains wide. Our asset allocation still favours emerging market equities, both structurally (Asia sits at the heart of the global industrial value chain) and tactically (emerging markets benefit from dollar weakness). That view remains unchanged post-summit.
 

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