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Market 'too optimistic' on US-China trade war

 

The biggest risk for investors in the year ahead is having a too optimistic outlook on the US-China trade war, according to JPMorgan Asset Management's Karen Ward.

Ms Ward, chief market strategist for Emea at the asset manager, told David Thorpe it was not in the interests of China's President Xi Jinping and US President Donald Trump to "ramp up the escalation", but she admitted, "I think we will continue to see deadlines being pushed out".

In the latest FTAdviser podcast she also discussed politics closer to home and suggested when it comes to Brexit, "we will end up with something that is relatively soft", in terms of the ongoing trade links with the EU. 

"I think the main upside most clearly comes through sterling, that’s where I think the biggest Brexit risk premium is," Ms Ward added.

Finally, Ms Ward considered whether the tide was turning for emerging markets, which have been through a recent period of underperformance but were now seeing fund sales pick up.

She explained a "much more dovish stance from the Federal Reserve should put downward pressure on the dollar through time and that is helpful to the emerging markets".

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eleanor.duncan@ft.com