Tech Soars on US–China Tariff Truce While High‑Dividend Stocks and EM Debt Get Squeezed

Following reports that Washington and Beijing agreed to roll back portions of their bilateral tariffs, global equity markets rallied on September 26, with technology shares leading the advance. Semiconductor makers, cloud computing leaders and other growth names outperformed, helping major indices notch fresh highs. In contrast, traditional “bond‑proxy” sectors such as consumer staples, utilities and high‑dividend stocks came under pressure as U.S. Treasury yields marched higher.

The 10‑year U.S. Treasury yield is hovering near the 5% area, close to levels last seen before the global financial crisis. Combined with a firmer U.S. dollar, that move is creating a tougher backdrop for emerging‑market sovereign and corporate bonds, many of which are issued in dollars. Higher U.S. yields raise investors’ required returns on EM debt, pushing prices lower and widening credit spreads as concerns about future refinancing costs grow.

At the same time, the partial tariff truce is a clear positive for global supply chains and for companies tied to cross‑border trade in electronics and software. The rotation from defensive income plays into cyclical growth stocks has become more visible. For Japanese investors, the current environment underscores the need to differentiate between tech‑driven beneficiaries of easing trade tensions and yield‑oriented defensives that are now competing with 5%‑plus U.S. government bonds, while also reassessing exposure to EM bond funds that are sensitive to dollar strength and rising global rates.