Goldman trims 2025 upside targets for Chinese stocks as Trump tariffs slam markets

Name: US tariff storm disrupts global business expansions, but some see opportunities
Uploaded: 2025-04-06T23:30:15.000Z
Duration: 4 min 47 s
Description: US tariff storm disrupts global business expansions, but some see opportunities

Goldman trims its 12-month upside targets for the MSCI China Index and CSI 300 Index, after a bullish upgrade in mid-February

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Electronic boards show Shanghai stock data and other market indices on April 3, 2025. Photo: Reuters

Enoch Yiu

Published: 7:30am, 7 Apr 2025Updated: 6:22pm, 7 Apr 2025

Goldman Sachs trimmed its 2025 upside targets for Chinese stocks less than two months after a bullish upgrade, as the US and China imposed higher tariffs on each other’s imports, sending global financial markets into a tailspin.

The Wall Street investment bank cut its 12-month target for MSCI China Index to 81 from 85, and the CSI 300 Index of the largest stocks in Shanghai and Shenzhen to 4,500 from 4,700 in a report to clients on Sunday. The bank had upgraded both indices on February 17 following DeepSeek’s breakthrough in artificial intelligence services.

The new targets imply an upside of 10.7 per cent and 16.5 per cent, respectively, from the levels on Friday.

Stocks in mainland China and Hong Kong sank on Monday, triggering the worst day for traders since the global financial crisis in October 2008. Much of the bull run and world-beating gains in Chinese stocks, accumulated since DeepSeek’s breakthrough in January, has evaporated quickly as President Donald Trump lived up to his election vows to unveil big reciprocal tariffs on all its trading partners.

“The bull run will slow on event risks and profit-taking pressures,” strategists including Kinger Lau and Timothy Moe wrote in the report. “The market may test our risk-case valuations in the short term until trade and policy clarity emerges, and/or a new tariff equilibrium is reached.”

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US tariff storm disrupts global business expansions, but some see opportunities

US tariffs could hit corporate earnings through a direct hit on exporters, and an indirect impact on China’s economic growth, given the potential negative spillovers to investment and confidence, Goldman said. The firm has recently raised the odds of a US recession in 12 months to 35 per cent from 20 per cent given the new challenges.