US stock investors face concerns over tariffs, trade agreements, rate cuts, market breadth, and geopolitical risks.

From Yahoo Finance: 2025-07-01 06:02:00

The U.S. stock market ended the first half of 2025 at record highs, up over 5% for the year. Concerns linger over Trump’s tariffs and trade agreements, with a July 9 deadline looming. Higher tariffs could drive up inflation and impact company profits. Second-quarter earnings reports will be critical.

Fed Chair Powell cites tariff concerns as a reason to hold off on rate cuts, despite market expectations for three cuts by year-end. A weakening economy and labor market could prompt rate cuts. Trump’s pressure on the Fed to cut rates raises concerns about the central bank’s independence.

Technology and growth stocks have led the market rebound, raising concerns about market breadth. The equal-weight S&P 500 is up nearly 4% in 2025. Stock valuations have climbed, with the forward P/E ratio hitting a high of 22.2. Investors are looking to future earnings prospects and Treasury yields for valuation clues.

Questions about U.S. asset allure and global equity dominance have emerged in 2025. U.S. equities have underperformed international markets. Geopolitical tensions, like the Israel-Iran conflict, could impact stock volatility. Oil supply constraints could lead to price spikes, affecting equity returns. Geopolitical risks, while not historically a major headwind, can cause market turbulence.



Read more at Yahoo Finance: Six questions facing US stock investors as 2025’s second half kicks off