Cross-Asset Strategist & Quantitative Analyst, Pennock Idea Hub

Cam Hui

Cam Hui has been professionally involved in the financial markets since 1985 in a variety of roles, both as a quantitative equity portfolio manager and as a sell-side analyst. He graduated with a degree in Computer Science from the University of British Columbia in 1980 and obtained his CFA Charter in 1989.

Cross-Asset Strategist & Quantitative Analyst

Introducing Our Trend Asset Allocation Model

Pennock Idea Hub

We are creators of independent equity research. The Pennock Idea Hub team are veterans of the investment industry. Much of our team has spent their careers at Merrill Lynch, Deutsche Bank, RBC Capital Markets and Wood Gundy. We have taken every aspect of research back to the studs and returned to first principles. The Pennock Idea Hub marries the interests of the sell and buy side. 

We offer the best research for institutional investors by:

-Only publishing research from veteran analysts
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Cross-Asset & Quantitative Research

Cross Asset Strategy

China & United states / Cross Asset Strategy

The markets took on a decided risk-off tone early last Monday when President Trump — aka the Tariff Man — made an early morning tweet to announce steel and aluminum tariffs on Brazil and Argentina.The markets took further fright based on Trump’s comment that he had no timetable for a trade deal with China, and he was willing to wait until after the 2020 election to conclude an agreement. More importantly, Edward Lawrence of Fox Business reported that there are no current plans to delay the next round of tariffs scheduled for December 15, which is an unanticipated development as the market consensus was they would be delayed.If the December 15 tariffs are enacted, what is the expected damage? How will that affect our thesis of a cyclical rebound (see <a href="https://www.smartkarma.com/insights/a-seismic-shift-in-factor-returns" target="_blank" rel="noopener">A Seismic Shift in Factor Returns</a>)?We conclude that the reflation thesis is still intact. Both Fed policy and European fiscal policy stand poised to offset the negative effects of Tariff Man’s threats. In addition, the Fed’s study concluded that most of the negative effects on business confidence has already been felt, and stock prices have risen during that period despite Trump’s trade war.

The markets took on a decided risk-off tone early last Monday when President Trump — aka the Tariff Man — made an early morning tweet to announce steel and aluminum tariffs on Brazil and Argentina.The markets took further fright based on Trump’s comment that he had no timetable for a trade deal with China, and he was willing to wait until after the 2020 election to conclude an agreement. More importantly, Edward Lawrence of Fox Business reported that there are no current plans to delay the next round of tariffs scheduled for December 15, which is an unanticipated development as the market consensus was they would be delayed.If the December 15 tariffs are enacted, what is the expected damage? How will that affect our thesis of a cyclical rebound (see A Seismic Shift in Factor Returns)?We conclude that the reflation thesis is still intact. Both Fed policy and European fiscal policy stand poised to offset the negative effects of Tariff Man’s threats. In addition, the Fed’s study concluded that most of the negative effects on business confidence has already been felt, and stock prices have risen during that period despite Trump’s trade war.

How Far Can Tariff Man Dent The Stock Market?