UBS warns that the commerce warfare with China might escalate from present ranges, regardless of President Donald Trump’s non permanent pause on U.S. tariff threats towards Mexico and Canada, As of Tuesday, the U.S. levied a ten% tariff on all Chinese language items, however Trump has beforehand threatened tariffs as excessive as 60% towards China, UBS international fairness strategist Andrew Garthwaite stated. “We expect tariff discuss on China could rise past the ten% tariffs, perhaps as soon as a TikTok sale is full,” the strategist wrote in a observe on Tuesday. Within the midst of the tariff uncertainty, Garthwaite advises buyers to remain obese defensive names. When modeling for an aggressive tariff state of affairs, know-how and shopper shares underperform the market, he added. Heightened commerce tensions might additionally stoke “nationalistic shopping for” in China — when customers shift to home manufacturers on the expense of U.S. shopper manufacturers, he added. “If we get extra of a worldwide commerce warfare, then the winners will doubtless be these corporations who supply domestically versus those that export,” stated Garthwaite. With this in thoughts, listed here are among the corporations UBS believes are most in danger if U.S.-China commerce relations deteriorate additional, or new conflicts erupt with Canada, Mexico or the European Union: Shopper-centered corporations make up the vast majority of the businesses on the listing of tariff-sensitive shares. Athletic attire maker Nike and Coach and Kate Spade proprietor Tapestry are among the many names most in danger from rising tariffs. Tapestry shares are 15% increased Thursday on the again of sturdy Coach gross sales in the course of the vacation, leaving the inventory buying and selling above the typical analyst’s worth goal, implying {that a} pullback could also be forward. However Tapestry stated it would not count on a further 10% tariff on items from China to harm its outcomes. UBS holds a impartial ranking on Tapestry. Athletic attire firm Nike was one of many shares hit essentially the most earlier than Trump provided a reprieve on items from Mexico. China tariffs will have an effect on each provides and demand for Nike items. Nike depends not simply on imports from China, equivalent to materials; the nation can also be considered one of its greatest shopper markets. Nike shares have slipped greater than 1% to start out the yr. NKE TPR YTD mountain Nike and Tapestry shares in 2025 Low cost retailer Greenback Tree was one of many corporations UBS known as most weak to excessive tariffs. Chinese language imports account for a good portion of the corporate’s gross sales. Round two-thirds of analysts protecting Greenback Tree charge the inventory a maintain. In the meantime, the consensus worth goal implies shares will acquire 21% from Wednesday’s shut. DLTR 1Y mountain Greenback Tree shares over the past 12 months UBS additionally recognized auto shares as names that will probably be laborious hit by increased China tariffs. Shares of motorbike maker Harley-Davidson have bought off greater than 4% over the past 5 days, reaching a brand new 52-week low on Wednesday on disappointing fourth-quarter outcomes. Analysts are on the sidelines. Of 15 analysts protecting Harley, 9 charge it a maintain. However the common worth goal is $35, or 33% above the inventory’s shut on Wednesday. Shares of Rivian are additionally down greater than 3% to kick off 2025, underperforming the broader market. Tariffs might dent demand for Rivian in China, which already has a sturdy home EV market. UBS has impartial scores on each Harley-Davidson and Rivian. RIVN YTD mountain Rivian inventory in 2025 —CNBC’s Michael Bloom and Christina Cheddar-Berk contributed to this report.