Expert explains the impact Is today's stock market quake just the beginning?
US President Donald Trump continues with his one-way policy. On Monday, he imposes punitive tariffs on Canada, China and Mexico. He also imposes punitive tariffs on Europe. An expert explains to blue News what this means for Switzerland.
No time? blue News summarizes for you
- Donald Trump's announcement of new punitive tariffs against Europe led to price losses on the stock markets.
- In Switzerland, companies such as Kühne + Nagel and Logitech would be particularly affected, while the pharmaceutical industry appears less vulnerable due to its market power.
- An escalation of the trade conflict could only affect consumers if Switzerland takes countermeasures.
Donald Trump's recent announcements that he would impose punitive tariffs on Europe have made waves on the stock markets. The Swiss benchmark index SMI was not unaffected either, falling by 1.65% on Monday morning.
"The main reason for today's movements are Donald Trump's tariff announcements," explains Felix Jäger, investment strategist at Zürcher Kantonalbank (ZKB), to blue News. Nevertheless, the SMI is less affected than other indices. Jäger nevertheless dares to take a look into the future: "The logistics company Kühne + Nagel could be hit hardest in Switzerland, as it is directly linked to international trade flows."
Logitech could also be affected, as the company exports a lot to the USA. Of course, this is only under the premise that Trump would impose punitive tariffs on Switzerland and it would react accordingly with countermeasures.
The automotive industry could now be under even greater pressure
In the eurozone, on the other hand, the automotive sector is the hardest hit. "This is understandable, as there are alternatives to European cars in the USA," says Jäger.
The pharmaceutical industry could be less affected. "The market power of Roche or Novartis is high. There are no alternatives for many of their medicines in the USA," explains Jäger, which is why Americans are still forced to buy medicines from Swiss companies. Even if the products could become more expensive as a result of possible punitive tariffs.
What could be the impact of an escalation?
If the trade conflict escalates further, this would be fundamentally negative for the Swiss stock market. "Nevertheless, it has to be said that the SMI is not severely affected. It is still up 8 percent since the start of the year," says Jäger.
The US market remains robust, which creates a positive environment for the equity landscape as a whole. The real question, however, is who Trump will target next. "So far, he has hit Canada, Mexico and China."
If tariff loopholes are closed, this could also affect Swiss companies in the medium term. However, many Swiss companies have a high level of pricing power, which makes them more robust.
Will prices soon rise for Swiss consumers?
It is unlikely that the Swiss population will feel the effects directly. "Products from the USA could become more expensive if the USA actually imposes tariffs on Switzerland - and Switzerland reacts with countermeasures," explains Jäger. However, it is still too early to make concrete forecasts.
One thing is certain: The trade disputes remain a risk factor - but the Swiss economy has so far proved resilient.
