Tariff-fogged markets leave investors flying blind

Global investors admit to flying blind in markets roiled by erratic US trade rhetoric and chaotic economic forecasting, stressing that placing long-term bets was harder now than at any time since the 2020 Covid-19 crisis.

- NAOMI ROVNICK

Anxieties over whether a 90-day White House-China tariff truce will hold, plus US budget gaps and whipsawing currencies have made investors extremely cautious about where to put their money.

Markets have been on a rollercoaster ride for weeks, with world stocks rallying 20% from more than one-year lows hit after US President Donald Trump's April 2 tariff bombshell, after slumping 15% in three sessions.

The turbulence continued on Thursday with a sudden selloff in global government debt, the latest event to spook long-term investors out of markets that they fear have lost the anchoring force of consensus forecasts.

"There is no macroeconomic visibility," said Francesco Sandrini, Italy CIO at Europe's biggest asset manager Amundi.

He said he was following short-term speculative market trends instead of taking a stance on the global outlook.

"You may be right on the end-game for economics and valuations in the long term but the risk is that it is going to be very painful in the short term."

Other money managers said they had shifted global portfolios onto neutral settings, which ensure the balance of investments is not tilted towards any particular scenario, because even if their views were right, assets were not trading reliably.