Possible scenario
Managed Détente Holds
45% Chance
The most likely path is that Washington and Beijing implement the reciprocal tariff reductions while preserving leverage through monitoring and carve-outs. Both Trump and Xi have incentives to keep the 2027 truce alive after the September summit, especially with fentanyl tariffs reduced and the Geneva framework revived.
Initial impacts
- Market volatility Down
- Riskier companies' borrowing costs Down
- 10-year Treasury yield Up
- Copper Up
- US dollar Down
Secondary impacts
- Industrials +0.9%
- Technology
Portfolio impact
S&P 500+0.7%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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