From Financial Modeling Prep: 2025-04-23 02:40:00

Investor sentiment has soured, with recession and stagflation fears rising, leading to defensive positioning amid policy uncertainty, as per BCA Research. U.S.-China trade tensions and tariffs are affecting corporate profitability, with sectors like Consumer Discretionary, Industrials, and Materials facing margin squeeze. Tariffs are expected to lower S&P 500 net margins by 2%, leading to a contraction in fair-value multiples.

As companies prepare for earnings season, forward guidance becomes crucial, with BCA anticipating downgrades due to tariff headwinds. Defensive positioning may favor sectors like Utilities, Consumer Staples, and Healthcare, while higher-beta names in Industrials and Materials could see further downside. Monitoring sector valuations in real-time can help identify sectors most impacted by tariff effects.



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