Core Viewpoint - The article discusses the significant impact of Trump's trade policies on Wall Street, highlighting a shift in sentiment among financial elites who now largely oppose him due to the unpredictability and consequences of his actions [3][6][18]. Group 1: Market Reactions and Sentiment - The recent market turmoil, characterized by a simultaneous decline in stocks, bonds, and currencies, reflects a growing discontent with Trump's policies among Wall Street professionals [3][4]. - A notable shift occurred on April 2, when Trump announced substantial tariffs, leading to a market crash as investors realized the seriousness of his intentions [9][12]. - The S&P 500 index experienced a peak decline of 25%, while the Nasdaq fell by 21%, indicating widespread losses across the market [14]. Group 2: Impact on Specific Sectors - Companies directly affected by tariffs include those in consumer goods, particularly those producing clothing, shoes, and toys, which are primarily manufactured in Asia [22]. - The tourism sector, including hotels and airlines, is also expected to suffer as international travel to the U.S. has already dropped by 50% due to the trade conflict [23]. - Technology companies like Google and Meta are facing potential backlash from the EU, which could further impact their advertising revenues amid economic downturns [24]. Group 3: Investment Strategies and Fund Performance - Many hedge funds have adopted a conservative approach, reducing leverage and maintaining neutral positions in response to market volatility [14][15]. - Quantitative funds have struggled to adapt to the rapid changes in Trump's policies, leading to significant losses [16][17]. - Long-only mutual funds with high risk exposure have also faced challenges, particularly those heavily invested in equities without adequate hedging [17]. Group 4: Future Outlook and Economic Implications - The current tariff levels, reaching as high as 145%, are perceived as tantamount to a trade embargo, raising concerns about long-term economic impacts [28][29]. - Analysts predict that if tariffs remain high, the U.S. economy could face a significant downturn, with potential GDP impacts of 1%-1.5% and inflation increases of nearly 2% [31]. - The article emphasizes that the current economic situation is artificially created and differs from structural crises like the 2008 financial crisis, suggesting that the underlying economy remains relatively stable [32]. Group 5: Opportunities Amidst Challenges - Some companies may benefit from the current environment, such as AutoZone, which could see increased demand for auto parts as consumers delay new car purchases due to rising prices [25]. - European stocks have begun to show independent performance, with certain companies, like Infineon, remaining insulated from U.S. market turmoil due to their global production strategies [26]. - Mercado Libre, a leading e-commerce company in Latin America, has also thrived during this period, demonstrating resilience against U.S. market fluctuations [26].