China - US Trade War: Goldman Sachs reduced its target on China's market amid trade war

Global brokerage firm Goldman Sachs has cut the target on China's major stock index. This is the second consecutive time in the month of April that the brokerage firm has cut the target on the index. This reduction in target by the brokerage firm has been seen amid the recent trade tensions with the US. Kinger Lu, the head of this report of Goldman Sachs, wrote on Monday that trade tensions between the US and China have reached a new peak and this has raised concerns of economic recession at the global level.

Kinger Lu further wrote that the risk of decoupling between these two big economies of the world has arisen. This will also have an impact on capital markets, technology and geopolitics.

What is the new target?
The brokerage firm has reduced the target for the next 12 months on the MSCI China Index from 81 to 75. Whereas, the target for the CSI 300 index has also been reduced from 4,500 to 4,300. After the new target, both these indices are now expected to rise by 12% and 15% respectively from Friday's closing price. Impact of tariff war on market sentiment The growing trade war between the US and China has now reached a new turn. In response to America's 145% tariff, China has announced a counter tariff of 125%. Due to this tariff war between the two countries, the stock markets of China have also been affected and investor sentiment has also been affected. The MSCI China index was seen trading with a gain of 2.5% on Monday. This rise is being seen due to the news of tariff relief from the US on phones, computers and consumer electronics. At the same time, the CSI 300 index saw a rise of 1.75%. Target was raised in February After the biggest decline in the Chinese market in many years, Goldman Sachs has taken a bullish view. In February, the brokerage firm had raised the target for the MSCI China index from 75 to 85. This was the same time when China launched its artificial intelligence DeepSeek. However, after Trump's announcement regarding reciprocal tariffs, this index has slipped by 8%. For the first time, Goldman Sachs had reduced the target on this index from 85 to 81 on April 6. 

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