Investors Dial Back ‘Trump Trades’ as Policy Questions Remain

Published On Nov 8, 2024, 2:38 AM

Investors are showing caution regarding 'Trump Trades' as questions arise about whether President Trump will successfully implement his proposed tariff policies. After expecting a surge in certain assets, market enthusiasm is cooling as traders assess the viability of Trump’s ambitious proposals, particularly tariffs of up to 60% on Chinese goods. Despite some bullish movement in U.S. equities (especially small-cap and regional banks), there is growing skepticism about the feasibility of Trump’s trade policies and their inflationary effects. Ultimately, the direction of the markets now hinges on broader financial events, including Federal Reserve policy and potential fiscal stimulus from China.