From Financial Modeling Prep: 2025-05-12 07:35:00

Trade frictions are impacting global growth, prompting BlackRock to advise investors to be selective. Supply-side contraction is forecasted for the U.S., with S&P 500 EPS growth estimates dropping from 14% to 8.5%. Tariffs could lead to higher inflation, complicating the Fed’s rate cut plans.

Earnings season serves as a barometer for the impact of tariffs, with companies discussing moving production to the U.S. or tariff-friendly countries. Big Tech outperforms with 30% earnings growth, while Europe faces execution risks despite infrastructure and defense support.

Strategic takeaways include staying overweight in DM equities, focusing on AI leaders and monitoring earnings calls for reshoring discussions. Inflation dynamics from tariffs may reshape Fed expectations. Pairing earnings insights with sector tilting can help navigate tariff challenges and benefit from growth winners.



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