Understanding Tariff Headwinds

This month marks the start of summer trading. Our Chief Equity Strategist and Economist, John Blank, and his stock strategy team here at Zacks has pulled together the major large cap U.S. stocks -- facing 2025 tariff headwinds. John’s here now to discuss this.

1. Looks like there are two major areas these stocks fall into, as far as imports and exports are concerned. What are they?

2. What are the top sectors going from Very Attractive to Unattractive that will face these headwinds?

3. Will these headwinds be significant drops in these large caps?

4. Does this surprise you at all?

5. You’ve written, that there is a sense of relief now about the effects of U.S. tariffs, on the top stocks of the U.S. biggest importers and exporters. But it may also be temporary share price relief. Given recent tariff developments, might it just be temporary amid optimism for potential trade deals?

6. So far, the market’s had a muted reaction to the U.S.-China framework deal agreement announced last week. If stocks move higher do you think it’ll be as a result of this type of news or positive economic data?

7. Published data reveals that stocks haven’t been as expensive, as they are now, compared to bonds, in almost 25 years. Is that a negative for stocks?

8. What strategy should investors use now? Should they be looking at defense stocks on the heels of Middle East Tension escaltions?

9. This month, you chose three large cap stocks with a short-term #1 Rank, and a very attractive long-term Zacks VGM score of A. Sumitomo Corporation SSUMY, Next plc NXGPY and Sprouts Farmers Markets SFM.

Our Chief Equity Strategist and Economist, John Blank, on stocks facing tariff headwinds . With John, I’m Terry Ruffolo.

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This article originally published on Zacks Investment Research (zacks.com).

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