Market Update 9th May 2025: Growth, Tariffs, and the Shifting Economic Landscape

Introduction:

The 2025 market presents growth opportunities alongside the complexities of Trump's strategic tariffs. This is a concise update analyzing sector prospects, trade policy impacts, and expert views, including the role of crypto.

Executive Summary: Sector Opportunities and Risks

• Bullish: Tech & AI, Green Energy, Healthcare & Biotech, select Asian/Southern European markets.

• Bearish Pressures: Manufacturing, industrial, and consumer-sensitive sectors.

Emerging Economic Contraction Risks:

• Recent data points to a potential Q1 contraction due to trade deficits, weak spending, pre-tariff activity, and spending cuts.

• Red flags: rising jobless claims, falling home sales, potential stagflation.

Current Market Landscape & Policy-Driven Risks:

• S&P 500 growth targets face volatility from tariffs and potential contraction.

• Corporate earnings under pressure from trade and policy uncertainty.

Expert Insights:

• Tech & AI: Continued growth, but regulatory scrutiny possible. S&P 500 stability supported by tech.

• Green Energy: Long-term potential with short-term policy/investment volatility.

• Healthcare & Biotech: Steady growth in innovation, but cost concerns remain.

• Crypto (Bitcoin): Potential beneficiary of tariff-driven volatility and fiat currency uncertainty. Monitor performance against dollar fluctuations. Divided expert opinions on long-term stability.

• Manufacturing & Industrial: Significant challenges from tariffs and trade disruptions. Reshoring is costly.

• Consumer Spending: Vulnerable to inflation and economic downturn.

The US Economy and Equities: Two Potential Scenarios (Condensed):

• Scenario 1: Status Quo (with Volatility): Increased market swings due to tariffs and economic shifts. Focus on resilient sectors and active management.

• Scenario 2: Major Disruption (Exacerbated Weakness): Significant market decline, demand for safe havens. Focus on capital preservation and defensive stocks.

Key Actions for Investors:

• Diversify, monitor economic/political developments, rebalance, conduct due diligence, seek advice, watch key indicators (bond yields, inflation, Bitcoin).

Conclusion:

2025 presents a complex landscape shaped by growth opportunities and the strategic impact of Trump's tariffs. Vigilance and adaptability are crucial for navigating these uncertainties.

Call to Action:

Stay close with your adviser within the JSG Network to ensure your investment strategy and portfolios stay relevant to the market as well as to your risk profile and timeframe(s).

Regards

The Just Service Client Service Team