📰 Market Pulse

From TACO trades to bank earnings beats — markets recalibrate as volatility cools

Oct 15, 2025

Macro Overview

After a volatile week of tariff sabre-rattling, markets regained footing as U.S. equities rebounded +1.56% on Monday, recovering from Friday’s –2.7% slide triggered by President Trump’s threat of a 100% tariff on Chinese imports. The so-called “TACO trade” (Trump Always Chickens Out) played out once again as the White House softened its tone over the weekend.

The Federal Reserve’s September minutes reaffirmed its dovish bias: most members favoured additional easing through year-end to cushion downside risks to employment, while acknowledging lingering inflation pressures. Chair Jerome Powell confirmed that the Fed is nearing the end of its balance-sheet runoff but offered no forward guidance on rates. Meanwhile, the U.S. government shutdown continues to stall the release of key macro indicators.

In Europe, German industrial production fell 3.9% YoY in August, led by declines in autos and pharmaceuticals, while the euro area remains sensitive to weak external demand.

In China, September’s trade surplus narrowed to USD 90.5 bn as imports rose 7.4% on restocking ahead of Golden Week and exports gained 8.3%, their fastest pace since March.

Geopolitically, Israel’s ceasefire in Gaza briefly pressured European defence stocks, while risk assets steadied globally.

China–US Trade and Regulatory Front

When President Donald Trump reaches for his trade toolkit, it often feels improvisational. Beijing, by contrast, tends to move in measured steps — holding cross-ministerial consultations before firing a single policy shot. That discipline was again visible on 10 October, when the State Administration for Market Regulation (SAMR), China’s antitrust authority, announced an inquiry into Qualcomm, while the Ministry of Transport introduced new docking fees for U.S.-owned vessels.

A day earlier, the Ministry of Commerce tightened rare-earth export controls, a move that reportedly caught Washington off guard after months of relative calm. Officially, SAMR described the Qualcomm investigation as routine — prompted by the company’s failure to report its USD 80 million purchase of Autotalks, an Israeli smart-transport start-up. Still, the timing is notable. Over the past few years, Beijing has been building a more rules-based regulatory framework, aligning competition and export-control laws with global standards.

SAMR, once a domestic antitrust agency, now operates at the intersection of market supervision and strategic policy, mirroring how U.S. agencies have long intertwined regulation with national-security considerations.

Seen through that lens, SAMR’s growing assertiveness is less about retaliation and more about reciprocity — China adapting to a world where industrial policy and legal instruments are routinely fused.

Past cases — from Qualcomm’s NXP merger to reviews involving Google and DuPont — illustrate how Beijing’s enforcement cadence often tracks the rhythm of trade negotiations, yet rarely strays outside its own regulatory remit.

Recent scrutiny of Nvidia and Qualcomm fits this pattern. Antitrust reviews now serve a dual purpose: enforcing domestic competition law while reinforcing the country’s tech-security agenda — particularly in areas such as semiconductors, operating systems, and connected mobility.

Qualcomm’s Autotalks deal touches precisely that frontier. The firm develops vehicle-to-everything (V2X) systems — technology central to China’s ambitions in intelligent vehicles and autonomous driving.

For policymakers in Beijing, ensuring that these next-generation networks are not overly dependent on foreign suppliers is both an industrial necessity and a sovereignty imperative.

As one Shanghai analyst put it with mild irony, “China doesn’t need to weaponise regulation — it simply needs to use it as everyone else does.”

In that sense, the trade war has entered a subtler, more institutional phase.
Tariffs may grab headlines, but the real contest now unfolds in rule-making, enforcement, and technology governance — the quiet spaces where economics, law, and geopolitics increasingly converge.

Cargo ship docked at a busy port at night.

Market Performance (14 Oct 2025)

Amid a complex policy and geopolitical backdrop, global markets moved unevenly last week. Defensive assets such as gold and sovereign bonds gained, while risk assets — notably Chinese internet stocks, cryptocurrencies, and U.S. tech — came under renewed pressure.

The divergence highlights investors’ cautious positioning and selective risk-taking.

Earnings Watch: U.S. Banks Set the Tone

As sentiment steadied, attention shifted from macro noise to micro fundamentals, with corporate earnings taking centre stage in guiding near-term market direction.

Q3 results from major U.S. banks broadly beat expectations, signalling economic resilience despite limited macro data.

These results reduce the probability of the “cold-leg” scenario in Genuine Impat’s Cold–Hot Market Roadmap, pending confirmation from upcoming earnings (notably Tesla, Tencent, and Alibaba next week).

The Week Ahead

Looking ahead, the focus turns to upcoming data and corporate releases, which will test whether the current rebound has a sustainable footing.

United States
Pending data releases (subject to shutdown resolution):

PPI (Sep): expected +0.3% m/m
Retail Sales (Sep): expected +0.4% m/m
Housing Starts & Permits (Sep): expected stable ~1.34 m

Europe / UK

UK GDP (Aug): expected +0.1% m/m
UK CPI (Sep): expected 4.0% YoY

China

CPI (Sep): expected –0.2% YoY
Continued export diversification supports trade recovery.

Earnings Calendar (Highlights)

US: Bank of America, Morgan Stanley, Abbott Labs, Charles Schwab, Travelers, American Express, Tesla, IBM.
Europe/UK: ABB, SAP, Hermès, Barclays, BASF.
China: CCB, CMB, Ping An, BYD, China Mobile, Tencent, Alibaba, JD.com, Meituan, NetEase.
EM & Asia: TSMC, Samsung Electronics, Infosys, Reliance, Vale, Petrobras, BHP, Rio Tinto, Shopify.

Closing Thought

Despite headline volatility, underlying market structure appears resilient.
Bank earnings are reinforcing confidence in U.S. fundamentals, while Asia’s trade rebound and Europe’s policy discipline set a cautiously constructive tone. As liquidity cycles turn and technical signals strengthen, selectivity — not speculation — will define alpha in Q4 2025.

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Created by Arya & David