Sam Dickie: Fisher Funds expert on what Donald Trump's new tariffs mean for investors

Donald Trump has unveiled a barrage of sweeping tariffs set to hit the rest of the world - and it's left a notable impact on the markets.

All countries, including New Zealand, have been hit with a 10 percent tariff, the EU will cop 20 percent, but Asia's been hit a little harder.

China will pay 34 percent on top of a 20 percent levy, Japan will pay 24 percent and India will pay 26 percent on their goods - and Vietnam and Cambodia will be hit with 46 percent and 49 percent, respectively. 

Fisher Funds expert Sam Dickie says the US markets have taken a dive - and markets across Asia have reacted strongly following this update.

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Episode Transcript

Speaker 1 (00:00):
Right now, it is time to have a look at
Trump's tariffs. He's fired as shots on trade. All countries
get ten percent, the EU cops twenty percent. Asia hit
quite hard. Here are the numbers for you. China thirty
four percent, Vietnam forty six percent, Taiwan gets thirty two,
Japan twenty four, South Korea twenty five, Thailand thirty six,

(00:20):
Indonesia thirty two, Malaysia twenty four, Cambodia forty nine. Sam
Dicky is Fisher Funds, He's with US Hi Sam good
eaving right now. The fact that Asia has been hit
so hard, I mean that has implications for US, given
how much trade we do there. But in terms of
market reaction today, that's where we've seen the biggest reaction,
is it not?

Speaker 2 (00:42):
That's right, Well, sort of two to three percent falls
in the US markets after close and Asian markets like
you know, the Neckeye in Japan down three percent, Vietnam
down sort of four or five percent, whereas good on
New Zealand as dead flat on the day.

Speaker 1 (00:58):
And are you is this what you were expecting? Were
you expecting them to be worse than this?

Speaker 3 (01:04):
No?

Speaker 2 (01:04):
I think, I mean the market generally was expecting sort
of a global tariff of twenty percent, and I think
the market was expecting it to be more uniform. So
the fact that it's a twenty nine percent weighted average
tariff around the world is worse. And the fact that
so non uniform was quite a surprise as well.

Speaker 1 (01:22):
So that's a good thing because the market's obviously, well,
they were pricing in something bad happening over the last
couple of weeks, weren't they. So is this is this
sort of a bit of a sigh of relief.

Speaker 2 (01:33):
Well, I think when the big news event that everyone's
expecting comes to pass, you do start to get some
sign of relief.

Speaker 3 (01:41):
But to be clear, this was worse than expected.

Speaker 2 (01:43):
This is twenty nine percent versus twenty percent expected, despite
the fact that markets have been weak, and as you said,
it's been disproportionately negative to Asia, but especially Southeast Asia.
You know, Vietnam, Cambodia, some of those countries have been
hit with sort of forty five fifty percent tariffs. So
that's definitely worse than expected, and that has flow on

(02:04):
impacts as well, because there's a lot of product that
is manufactured in those countries and a lot of product
that's been diversified out of China. So people have been
trying to diversify their supply chains away from China and
they've chosen Southeast Asia as the next best option.

Speaker 1 (02:20):
Right, So this is actually, I mean, yeah interesting. And
I was looking at Vietnam today. They I think it's
about thirty percent of you know, more than one hundred
billion dollars of what they produced goes to the United
States and they've been hit with what was it forty
six percent. I mean, that's that's for that kind of country.
That's pretty crippling, isn't it.

Speaker 3 (02:41):
That's right.

Speaker 2 (02:41):
But I mean, you know, we had been here in
the last few days that Vietnam had been feverishly trying to,
you know, walk back some of the tariffs it had
on US goods imported into its country.

Speaker 3 (02:52):
You hear to this, but I guess, you know, too little,
too late at the stage.

Speaker 2 (02:56):
But this is going to be critical to watch in
the coming days and weeks, is do some of these
countries back down reduce the tariffs on US imported goods,
which will in turn allow the US to back down
and lower the reciprocal tariffs.

Speaker 1 (03:10):
Now, let's talk about some new Zealand stocks for example,
I mean the likes of Fisher and Pike or what
happens with them. What did you any carve outs or
workarounds for these types of businesses from what you heard today.

Speaker 3 (03:24):
Yeah, Fish and Pocal Healthcare super interesting.

Speaker 2 (03:27):
Had a bit of a rollercoaster day, down as much
as seven percent at one stage, but encourage encouraging me
finished up on the day, and a couple of reasons
for that. The first is stock had been a bit
soft running into this and anticipation. But much more importantly,
while New Zealand was slapped with a ten percent tariff, Mexico,
where FPH manufactures about sixty percent of the product that

(03:48):
goes into the US, did not receive any incremental tariffs
and above the twenty five percent tariff it got earlier.
But most importantly, the White House confirmed that products manufact
in Mexico that are compliant with the US Canada Mexico
Trade Agreement will have zero tariffs, and almost all of
fph's products and Mexico is compliant. So that was really important.

(04:13):
And I've got to say, you know, we've been looking
at a lot of companies around the world today and how.

Speaker 3 (04:16):
They've reacted to this and what they've said.

Speaker 2 (04:19):
It was an absolute breath of fresh air to see
the clarity that if pH gave the stop market with
their release, and that's quite rare globally.

Speaker 1 (04:27):
Yeah, well they would be one of the lucky ones,
wouldn't they the lucky few?

Speaker 2 (04:31):
What is all of this? Well, not so much the
lucky few, but it's just the clarity with which they
put in that release, and that gave the clarity to
investors that that's quite rare.

Speaker 3 (04:41):
So I think that's right. And listen for other companies
around the world.

Speaker 1 (04:46):
What does all of this mean for investors.

Speaker 3 (04:50):
Well, we're two from here. I think is critical.

Speaker 2 (04:52):
So I always think, and this is a bit of
a fraud exercises trying to understand why is Trump doing this?
But if we take them at value, it's important and
it helps us begin to understand.

Speaker 3 (05:03):
The in game.

Speaker 2 (05:03):
So ostensibly it is to reduce the persistent US trade deficits.
It is to return manufacturing too the US, and it
is to serve as a bargainingship to drive lower tariffs
on US goods important into other countries. So if any
of those things start happening, we could see an easing
of this pretty draconian policy.

Speaker 3 (05:22):
So that's the first point.

Speaker 2 (05:24):
The second point is there's a bit of water to
go unto the bridge here that these tariffs weren't uniform.
And take Apple. Apple is a great case in point.
It was down sort of seven percent after market, not
only because it gets hit harder than expected on its
manufacturing in China, but perversely it also gets hit harder

(05:44):
than expected on the manufacturing it had moved to Southeast
Asia and India to diversify away from China. So I
think two points there. If we see those two things
happen that Trump wants, then we could see and easy
of this policy. But secondly, there's a bit of a
bit of uncertain water to go unto the bridge for

(06:05):
some of these companies where where they make decisions about
where to manufacture in the future.

Speaker 1 (06:10):
Let's hope it doesn't last too long. Sam, thank you
very much for being with me tonight, Sam Dicky from
Fisher Funds.

Speaker 2 (06:16):
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