Shares of Philips, Siemens Healthineers, and Carl Zeiss Meditec witnessed solid gains in today’s trading session in the wake of a pivotal weekend meeting in Geneva between the U.S. and Chinese governments, where both parties agreed to scale back their reciprocal tariffs on imports significantly for a 90-day period.
Among bigger movers, Philips shares are up 5%, Siemens Healthineers rose 4.2%, and Carl Zeiss Meditec increasing by 4.8% following the news.
The U.S. announced a reduction of tariffs to 30% from a previous 145%, while China will lower its tariffs to 10% from 125%. This easing of trade tensions is seen as a substantial positive for the MedTech industry, which had been facing notable headwinds due to the tariffs.
The reduced tariffs are likely to alleviate cost pressures and improve the profitability outlook for these companies. Analysts from UBS commented on the development, stating, “We think this is a significant positive for MedTech and specifically for recently upgraded GE Healthcare (Neutral) within our coverage as well as Philips (Buy), Biomerieux (EPA:BIOX) (Buy) and Siemens Healthineers (Neutral) whilst there may be indirect positive effects for Carl Zeiss Meditec (Neutral) too.”
They further elaborated on the financial impact, “US/China reciprocal tariffs were a meaningful (>5% of EBIT) headwind for a number of companies in our coverage given China is often the major supplier of key electronic components or rare earth minerals for products sold in the US whilst some legacy US manufacturing footprint is used for the export of key products (in particular diagnostic reagents) used in China.” Investing