US President Donald Trump’s tariffs on top trading partners are set to take effect, sending shockwaves through the stock market. Investors are bracing for impact by shuffling their holdings, with defensive sectors like consumer staples and healthcare gaining traction.
These sectors, typically considered less vulnerable to Trump’s trade policies, have seen significant gains this year – 5% or more in the case of consumer-staples and real-estate. The financials segment, conducting most business domestically, has risen 7.8%, outperforming the benchmark S&P 500 index.
Economists warn that rising import costs from tariffs could exacerbate inflation, but investors are betting on corporate earnings growth to offset the pain. As a result, investors are steering clear of international stocks and small-cap stocks, seeking more insulated areas.
Source: https://www.wsj.com/finance/stocks/trump-tariff-threats-have-turned-the-stock-markets-winners-and-losers-upside-down-a0173c92