Globalization boosts U.S. profits as cost of goods sold decreases, benefitting stock market

From Yahoo Finance: 2025-06-29 14:56:00

Higher tariffs and unfriendly trade policies are bad news for everyone, as they raise costs and impact inflation, productivity, economic activity, and corporate earnings.
Global trade policies have benefited U.S. companies, with the cost of goods sold as a percentage of sales dropping significantly over the years due to globalization.
Stock market profit margins have been expanding, driven by falling costs of goods sold as a percentage of sales.
Despite potential challenges from protectionist trade policies, Corporate America continues to find ways to maintain profitability and growth.
Recent data points show mixed consumer spending trends, with personal consumption expenditures declining slightly and card spending data showing varied results.
Inflation remains relatively low, with the core PCE price index hovering around the Fed’s 2% target.
Business investment activity is showing improvement, with core capital expenditures increasing in May.
CEOs and CFOs express concerns about the economic outlook, with sentiment indicators deteriorating in recent surveys.
Home sales, both existing and new, show mixed results, with prices cooling in some areas and rising in others.
The U.S. economy continues to grow, but uncertainty remains, especially in light of potential trade policy impacts and geopolitical events.