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Not time to go risk-on, say strategists

Strategists remain broadly optimistic that a US-China trade deal is likely to materialise, despite Donald Trump's latest threat to hike tariffs on Chinese imports later this week. Here is a round-up of their views.

Shipping containers from China and other nations being unloaded at the Long Beach Port in Los Angeles, California. Most strategists appear to have assigned a probability of about 60 to 70 per cent that a US-China deal will materialise.

UBS' Tan Min Lan advises investors to shift to higher-quality equities, which could mitigate the risk of near-term volatility.

DBS' Hou Wey Fook says: "We believe rationality will prevail at the end of the day. Our base case is that there will be a trade deal.''

Bank of Singapore's Eli Lee says: "We opt to keep our asset allocation strategy unchanged, and will not sell into this correction."

US PRESIDENT Donald Trump's threat to hike tariffs on Chinese imports later this week took markets by surprise, causing an immediate pullback.

The Shanghai Composite Index fell more than 5 per cent on Monday; the Hang Seng Index fell 2.9 per cent and the MSCI Asia ex Japan also tumbled by...

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