Quarterly Outlook
Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?
John J. Hardy
Chief Macro Strategist
Chief Investment Strategist
Volatility Is Inevitable. Don’t Panic. Market swings are common during times of political change, such as Trump's inauguration. Investors should evaluate their portfolios, assess their risk exposure, and maintain a balanced mix of investments to weather both market rallies and downturns.
Watch Sectors Likely to Move. Trump's proposed policies could benefit certain sectors like infrastructure, industrials, and financials, while others like healthcare and technology might face challenges. Investors should assess opportunities in sectors that align with their long-term strategy.
Think Beyond the Headlines. Markets don't always respond predictably to news about trade wars, tax policies, or deregulation. Investors should focus on fundamentals, invest in strong companies, use dollar-cost averaging, and keep cash reserves to take advantage of opportunities during market dips.
The start of a new presidency often brings fresh energy – and uncertainty – to the financial markets. With Donald Trump’s inauguration, investors are bracing for significant policy shifts. This could mean changes in taxes, spending, and trade agreements – all factors that markets may already be reacting to or will soon begin pricing in.
For investors, it’s natural to feel both excited about potential opportunities and apprehensive about the unknown. The key to navigating these waters? Focus on your long-term goals while staying flexible enough to take advantage of emerging opportunities. Let’s dive into how you can position your portfolio as this new chapter unfolds.
Market swings are common during times of political change, and this inauguration is no exception. Investors may be pricing in uncertainty around Trump’s proposed policies, such as his stance on trade, infrastructure spending, and tax reforms.
While the news cycle can feel like a rollercoaster, volatility isn’t a reason to sell everything. Instead, it’s a chance to evaluate your portfolio. Start by asking:
If you're not sure how to assess your risk exposure, you should check your asset allocation:
Trump’s proposed policies could create tailwinds for some sectors while putting pressure on others. Here’s a high-level view of what to watch:
Rather than chasing trends, use this as a guide to assess opportunities in sectors that align with your long-term strategy.
Headlines about trade wars, tax policies, or deregulation might grab your attention, but markets don't always respond predictably. For example, a tweet about tariffs might send stocks tumbling one day, only for them to recover after more clarity emerges.
Even seasoned investors feel the jitters during periods of uncertainty. That’s why it’s essential to have a safety net in place:
Trump’s inauguration marks the beginning of a new chapter for markets, but the core principles of smart investing haven’t changed. By staying diversified, focusing on fundamentals, and keeping a long-term perspective, you can turn uncertainty into opportunity.
No one can predict the future, but with a steady hand and a clear plan, one can be ready to face whatever the market throws their way.