The Tariff Rollout: Fast and Broad-Based
The opening moves came via executive orders in late February and early March. Canada and Mexico face 25% on non-USMCA-compliant goods, tied to border security concerns.
China gets an immediate 10% across-the-board increase, layered on existing Section 301 tariffs, with threats of escalation to 60% if no deal emerges.
Broader probes are hitting Europe (autos), India (tech and pharma), and Southeast Asia (electronics rerouting). The stated goal: close the trade deficit and incentivize onshoring.
Clear Winners Emerging
- Domestic industrials: Small/mid-cap manufacturers and steel producers ripping on reshoring hopes
- Energy: "Drill baby drill" rhetoric supports U.S. producers
- Financials: Banks benefit from steeper curve and deregulation momentum
- Dollar strength: DXY pushing past 108, capital inflows accelerating
Clear Losers Taking Hits
- China-exposed multinationals: Tech hardware, retailers, autos under pressure
- Importers: Names heavy on imported goods facing cost pass-through
- Emerging markets: EM currencies and equities hit by dollar strength
Mega-cap tech has held up better than expected — AI leaders shrugging off near-term noise thanks to secular demand.
Bottom Line
Tariff tensions are injecting fresh volatility, rewarding domestic purity while punishing global complexity. The dollar bid and sector rotation reflect a market pricing in pro-America growth.
This isn't a market-breaker yet — structural bull drivers like AI infrastructure remain dominant. But it's a clear regime overlay: favor names with U.S.-centric revenue and supply chains.