KUALA LUMPUR: Investors should view the easing of trade tensions between the United States and China as a temporary respite rather than a resolution, said digital investment firm Moomoo Malaysia. 

Head of dealing, Ken Low, said portfolio strategies should remain balanced and selective, with a focus on fundamentally strong companies and diversified exposures.

"For Malaysia, an export-oriented economy, the temporary 90-day tariff pause presents a near-term boost for key sectors such as electronics, palm oil, and manufacturing - segments that have been under pressure from global supply chain disruptions and weaker external demand,” he said in a statement today. 

The US and China have agreed to scale back tariffs and initiate a 90-day pause in additional duties. The US will lower its tariffs on Chinese imports to 30 per cent from 145 per cent, while China will reduce its tariffs on US goods to 10 per cent from 125 per cent.

Low said for Malaysian markets, this development offers a reprieve from the prolonged uncertainty that has weighed on investor sentiment since the start of 2025.

"The truce, which includes the rollback of tariffs on hundreds of products, is widely seen as a step toward stabilising supply chains and improving cross-border trade flows. However, gold prices experienced a steep decline, with spot gold falling over three per cent on May 12 - the sharpest drop since April,” he noted.

He said the gold selloff reflects a broader shift in market sentiment, as investors pull back from safe-haven assets in favour of riskier positions, driven by renewed optimism in equity markets.

"The recent sharp decline in gold prices serves as a cautionary reminder of how quickly market sentiment can shift.  While gold’s drop may reduce its immediate appeal, it still plays a valuable role as a hedge, particularly if trade talks stall or volatility returns,” he added. - Bernama