What should investors expect from the Trump-Xi meeting in China?

U.S.-China talks this week may help extend the current tariff truce, which would reduce an immediate drag on growth and market sentiment. Still, investors should not expect true tariff peace, as national security concerns, export controls, and strategic competition in AI are likely to keep barriers elevated for years.

That means companies will probably keep reshaping supply chains through nearshoring and friendshoring rather than reversing course. This shift creates opportunities in manufacturing hubs such as Southeast Asia and Latin America, while also pressuring margins for firms exposed to higher input costs.

The near-term tone is likely to stay cautious but constructive, with both sides having reasons to avoid a fresh escalation. For investors, the bigger picture remains one of persistent geopolitical friction and sticky inflation uncertainty. Diversification should remain a priority, especially across assets that can hold up when inflation stays higher than expected.