LIVE MARKETS-Liberation Day: Investors are trading cautiously

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LIBERATION DAY: INVESTORS ARE TRADING CAUTIOUSLY

Investors are being careful how they model their trading in reaction to the upcoming announcement by U.S. President Trump of sweeping new tariffs on global partners, said Janus Henderson's Julian McManus in a Reuters interview.

Trump proclaimed "Liberation Day" in the U.S. on Wednesday and has kept his tariff plans under wraps ahead of a White House Rose Garden announcement ceremony scheduled for 4 p.m. Eastern Time (2000 GMT).

But given how capricious the Trump administration has been in walking back prior tariff announcements on U.S. imports from countries including Mexico and Canada, some market participants are finding it difficult to plan their actions and trading accordingly, said, McManus, who is a portfolio manager on Janus Henderson's global alpha equity team.

"They are all over the place and volatility is jacking up as a result and it's why you see a lot of pressure on equities," McManus said. "Different people are reacting in different ways. Some people are already building the probabilities, while other people, like ourselves, are trying not to trade excessively until we have more information."

Trump last week followed through on weeks of threats for new tariffs on imported cars, saying a 25% import tax on vehicles not built in the U.S. would kick in on April 3 - on top of previous duties.

Toyota 7203.T - which has huge U.S. production capacity -will likely be less impacted by the tariffs and may not have to raise prices compared with its other Japanese car competitors such as Honda 7267.T and Nissan 7201.T.

"Honda and Nissan are far more likely to have to raise prices by however much the tariffs come in at and Toyota less so. Toyota will most likely end up taking market share from Honda and Nissan," said McManus. His portfolio contains Toyota stocks but not Honda and Nissan.

(Chibuike Oguh)

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