As President Trump implements a 25% tariff on all steel and aluminum imports, Macrolens managing principal and chief strategist Brian McCarthy joins Morning Brief with Seana Smith and Brad Smith to discuss which parts of the equity market (^DJI, ^IXIC, ^GSPC) are most exposed to trade war risks.
"I think the US equity market is terribly exposed to what’s happening. You have President Trump coming in and aggressively closing the border, [which] inflicts a supply shock on the US economy. At the same time, he’s in a dogfight in Congress simply to extend the 2017 tax cuts," McCarthy says.
The strategist believes that if the economy "starts to turn south in response to these, what look like dual supply shocks of cracking down on immigration and imposing tariffs, the [Federal Reserve] is in no mood to accommodate that."
"A number of [Fed] members have suggested that coming off the high inflation we’ve had, they’re going to look critically at any price pressures coming from these cost effects from [Trump policies on] immigration and tariffs, which is another problem for this policy cocktail," he says, adding, "I would go so far as to say I think the highs are in for US equities, and the downside is pretty considerable … if President Trump’s bite turns out to be as bad as his bark has been on these tariffs."
Watch the video above to hear more about how the strategist is thinking about the market impact of Trump’s tariff policies.
#youtube #stocks #news
About Yahoo Finance:
Yahoo Finance provides free stock ticker data, up-to-date news, portfolio management resources, comprehensive market data, advanced tools, and more information to help you manage your financial life.
– Get the latest news and data at finance.yahoo.com
– Download the Yahoo Finance app on Apple (https://apple.co/3Rten0R) or Android (https://bit.ly/3t8UnXO)
– Follow Yahoo Finance on social:
X: http://twitter.com/YahooFinance
Instagram: https://www.instagram.com/yahoofinance/?hl=en
TikTok: https://www.tiktok.com/@yahoofinance?lang=en
Facebook: https://www.facebook.com/yahoofinance/
LinkedIn: https://www.linkedin.com/company/yahoo-finance