Comments from Aadil Ebrahim, Group Head of Equities, Klay Group on President Donald Trump’s scheduled telephone call with Chinese President
“President Donald Trump’s scheduled telephone call with Chinese President Xi Jinping on September 19, 2025, is poised to set the stage for a potentially landmark meeting during President Trump’s upcoming trip to South Korea to attend the Asia-Pacific Economic Cooperation (APEC) Summit from October 31 to November 1. The recent trade negotiations, with the latest round held in Madrid, strongly suggest that the negotiating teams have finalized a trade agreement—pending formal signatures from both leaders—as well as an accord that will allow TikTok to continue operating in the United States.
Notwithstanding these positive developments, certain complexities persist. China has initiated an antidumping investigation targeting U.S. semiconductor companies, alongside a recent probe into Nvidia for alleged antitrust violations. China’s demand for increased access to U.S. technology remains a significant component of the ongoing trade discussions, and these issues are expected to be addressed during the forthcoming call. It is anticipated that the dialogue will yield a favorable outcome, culminating in the formal signing of the agreement when Presidents Trump and Xi meet in person.
From an equity market perspective, much of the uncertainty surrounding U.S.-China trade has been alleviated since trade talks resumed in May 2025. Although there have been intermittent setbacks, both parties have maintained consistent engagement. Consequently, it is unlikely that the call or the eventual signing of the trade deal will trigger a substantial uplift in Hong Kong or broader Chinese equity markets. Sectoral impacts may vary; for example, domestic Chinese semiconductor firms could face negative effects, whereas major Chinese technology companies may benefit from enhanced access to U.S. technology. The strong rally in Hong Kong and Chinese equities this year has predominantly been driven by domestic factors and improvements in earnings quality.”
