Memo To Trump: A Weak Dollar Begets A Weak Countryhttps://t.co/tRvMotR8fQ https://t.co/O99eHXZKEH ...

Macroeconomic Context - A weaker U.S. dollar is making international stocks more attractive as it increases the value of foreign earnings when converted to USD [1][2] - The Trump administration's One Big, Beautiful Bill raised the debt ceiling, leading to inflationary pressures on the dollar despite some spending cuts [2] - Analysts expect the Federal Reserve to begin cutting interest rates in the fall, which may further support international stock investments [2] Investment Opportunities - Mizuho Financial Group is gaining investor interest as Japanese stocks are seen as undervalued, particularly with the Bank of Japan cautiously raising interest rates [3][4] - Mizuho's stock has increased by about 20% in 2025, driven by improved loan profitability and earnings power due to a steepening yield curve [4] - United Microelectronics Corp. is positioned as a stable investment in the semiconductor sector, focusing on mature nodes needed for automotive and IoT applications, despite facing tariff concerns [7][8] - United Micro's stock is up 9.7% in 2025, with a stable net margin of 19%, although it has seen a decline of 5.6% over the last 12 months [8] - Suzano S.A., the world's largest pulp producer, is benefiting from recovering pulp prices and a joint venture with Kimberly-Clark, with its stock up nearly 5% in the last three months [11][12] - The Brazilian real's strengthening adds to the bullish case for Suzano, as its products are priced in dollars, indicating potential for growth [13]

Market Overview & Strategy - The market has largely priced in positive news, suggesting limited further upside and increased downside risk if earnings disappoint [1][7] - Strategy Asset Managers favors international markets due to the depreciating dollar, creating advantages for certain stocks [2] - A weak dollar is generally beneficial for US net exporters and should aid international stocks through translation effects [6][8] - The firm advises clients to look beyond short-term market noise and maintain a confident long-term outlook [5] Investment Opportunities - Marcato Libre, an e-commerce and fintech company with exposure to Argentina, is favored due to growth potential in Latin America, which is considered greater than in Europe [3] - The healthcare sector, particularly biotechnology and pharmaceuticals, is highlighted as a key area of focus [13] - Eli Lilly (Lily) is favored for its potential in the GLP-1 drug market, targeting the billion people globally who are obese [13] - Next-generation vaccines and personalized cancer vaccines represent exciting advancements in biotechnology [14] Monetary Policy & Economic Factors - The market anticipates the Federal Reserve to implement rate cuts, potentially starting towards the end of the year [10] - The high US deficit necessitates eventual rate cuts, although the timing remains uncertain [10][11]

Market Trends & Investment Strategies - Nvidia shares are up 50% from their April low, outperforming other Mag 7 stocks [1] - The market bull trend is considered underway, but short-term concerns exist due to falling company guidance [2] - Selective stock picking within the Mag 7 is advised, with overweight stances in Microsoft and Amazon maintained, and adding to Apple expected [3][4] - Professional investors showed pessimism, but the market is near a new high, suggesting a time to be less fearful [4][5] Macroeconomic Factors & Policy Impacts - Potential transformational changes in tax policy, such as expensing capital expenditure on software, could monetize the AI trade beyond the MAG 7 [6] - Expected tariff rates are decreasing, which could lead to more guidance from companies and increased optimism from professional investors [6][7] - Uncertainty remains regarding the full impact of Trump's tariffs and immigration policies on various industries [8][9] - Despite concerns, GDP growth is at 38%, averaging 25% for the first and second quarters [10] Currency & International Markets - The US dollar has lost 10% of its value since President Trump took office, which can be seen as beneficial for multinationals or as a sign of declining faith in American exceptionalism [12] - International investors, particularly in Europe, have been overweight in European stocks, but there's a growing reluctance to buy US stocks [17][19] - The dollar's weakness is beginning to slow down, with a trend towards solidification [16] - The consensus at the beginning of the year was that the dollar was overvalued, predating recent political events [21]