“So what do trade wars mean for financial markets? Clearly they are negative for equities. Economic growth would suffer, both short and longer term,” said Dario Perkins, managing director of global macro research at TS Lombard, in an note. “If we are also facing ‘de-globalization’, then we are probably talking about a lower equilibrium profits share,” he said.
“We are not saying that a major trade war is now inevitable, or even that this is the likeliest outcome. But rather that the chance of a quick resolution—the working assumption of most investors in 2018 — is fading away,” said Perkins.
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