Stocks fall on Trump tariffs

Whether President Trump will indeed soften his approach to tariffs as he has recently suggested is uncertain, but one thing that is clear is that average tariff rates are rising, according to Barclays.

“We think the direction of travel is clear: average tariff rates are increasing, likely to levels not seen since before World War II,” the firm’s Michael McLean wrote Wednesday.

“At the end of 2024, the US weighted average tariff rate was 2.5%. After the tariffs that Trump has implemented so far, the average tariff rate has increased more than 3 times to over 8%,” he continued. “We assume once Trump is finished, it could be as high as 15%.”

— Sarah Min

In a recent note, UBS shared three compelling reasons why investors should favor U.S. artificial intelligence firms over those of China’s.

“A lingering sense of nervousness remains among AI investors, primarily centered on the concern that Chinese AI developers and their low-cost models threaten to usurp US competitors with higher sunk investment costs,” wrote Mark Haefele, chief investment officer of UBS Global Wealth Management. “While both the United States and China have made significant strides in the AI sector, CIO believes there are compelling reasons to favor US AI companies over their Chinese counterparts, especially in the near term.”

Haefele said outsized capital expenditures from U.S. firms should drive greater competitive advantage.

“The higher capex intensity in the US, defined as capex spending divided by revenues, stands at 20% in 2025 compared to China’s 11.7%. This disparity highlights the US’s commitment to maintaining a technological edge, even though it may lead to higher depreciation-related expenses in the short term,” he wrote.

Meanwhile, higher research and development spending from U.S. AI firms means they are better positioned to discover “the next big thing.” Finally, Haefele underscored that U.S. firms have a “clear advantage” in higher monetization potential, suggesting that they have a better chance of generating revenues and profits.

— Lisa Kailai Han