{"id":79737,"date":"2025-10-22T15:00:00","date_gmt":"2025-10-22T07:00:00","guid":{"rendered":"https:\/\/www.kgieworld.sg\/research\/?p=79737"},"modified":"2025-10-22T15:39:23","modified_gmt":"2025-10-22T07:39:23","slug":"weekly-securities-newsletter-22-october-2025","status":"publish","type":"post","link":"https:\/\/www.kgieworld.sg\/research\/weekly-securities-newsletter-22-october-2025\/","title":{"rendered":"Weekly Securities Newsletter: 22 October 2025"},"content":{"rendered":"\n
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U.S.\u2014C<\/strong>hina Trade War Again?<\/strong><\/p>\n\n\n\n

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Chart of the Week:
China Tightens Rare Earth Controls; U.S. Retaliates With 100% Tariffs<\/h2>\n\n\n\n

On Oct 9, China announced expanded restrictions on rare earth exports. Any product containing over 0.1% of Chinese-origin rare earth materials, or produced using Chinese mining or refining technologies, will now be subject to export controls\u2014effectively bringing the entire rare earth supply chain under regulation. In response, the U.S. imposed 100% tariffs on Chinese imports, signaling a renewed escalation in the trade war.<\/p>\n\n\n\n

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Market Recap 1:
Trade Tensions Weigh on Market Sentiment; Defensive Sectors Outperform<\/h2>\n\n\n\n

Renewed U.S.-China trade frictions drove a rebound in the VIX and triggered a sharp pullback in U.S. equities before easing as Trump adopted a softer stance. Meanwhile, the U.S. government shutdown has entered its third week, underscoring the lack of bipartisan agreement on a temporary funding bill. Beyond delayed economic data releases, Trump also announced plans to cut federal staff, adding uncertainty to the economic and market outlook.<\/p>\n\n\n\n

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Market Recap 2:
Bond Yields Decline as Gold Extends Gains; Euro and Yen Strengthen<\/h2>\n\n\n\n

Trade tensions have driven a flight to safety, boosting demand for government and investment-grade bonds and pushing yields lower, with prices rebounding. In contrast, sentiment toward high-yield debt remains cautious amid signs of global economic slowdown.<\/p>\n\n\n\n

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What\u2019s Trending:
End of LDP\u2014<\/strong>Komeito Alliance Clouds Takai\u2019s Stimulus Agenda<\/h2>\n\n\n\n

Japan\u2019s ruling coalition between the LDP and Komeito has ended after 26 years. Markets had anticipated that Sanae Takai would pursue aggressive monetary easing, reversing Shigeru Ishiba\u2019s hawkish stance and
boosting equities. However, renewed U.S.\u2014<\/strong>China trade tensions and domestic political uncertainty erased part of the gains, unwinding the \u201cTakai trade\u201d.<\/p>\n\n\n\n

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In Focus 1:
European Banks\u2019 Stronger Balance Sheets Drive Outperformance<\/h2>\n\n\n\n

European banks have strengthened their fundamentals through several internal optimizations:<\/p>\n\n\n\n