The Trump administration has threatened to impose substantial tariffs on China in response to the country’s expansion of export controls on rare earths and related technologies. Market reactions have been predominantly negative, with global stock markets experiencing significant volatility following the announcement. Investors should remain vigilant regarding potential recession and stagflation risks triggered by these tariffs, which may continue to weigh on market sentiment. Compounded by elevated valuations, these factors could exert pressure on investment markets.

Accordingly, investors may consider adopting defensive allocations, including appropriate exposure to investment-grade bonds and low-volatility global equity strategies, to diversify portfolios, balance risk and return, and ensure the long-term stability of retirement funds.

To learn the market outlook for the October of 2025 provided by Sun Life Asset Management (HK) Limited, you can access the full version of the PDF Market Navigator – October 2025 for more details.