Markets under Trump: domestic strength and global uncertainty

Six months into President Donald Trump's second term, global markets are reconfiguring their positions in response to a leadership that has reprioritized the nation's national interest and economic competitiveness. While volatility has made its presence felt on Wall Street, the fundamentals of the U.S. economy show resilience in the face of a renewed reform agenda, fiscal retrenchment and blunt trade policy.

Sharp adjustments, but part of a strategic restructuring

Since President Trump returned to the White House in January 2025, markets initially reacted with optimism. In their first days, the three major U.S. indexes, the Dow Jones Industrial Average, S&P 500 and NASDAQ Composite, rose nearly 1% each, driven by market enthusiasm for an agenda that promised lower regulatory burdens, tax relief and strategic trade protectionism.

However, between February and April, markets underwent a substantial correction. As Trump announced new tariffs on China, Mexico, the European Union and Canada as part of his "economic repatriation" policy, investors reacted cautiously. In April, all three indexes fell sharply: the S&P 500 dropped more than 14% in a few days, the Nasdaq fell more than 10% and the Dow lost nearly 4,000 points (≈-9 %). This period, dubbed by some media as the "Liberation Day" marked the first major stock market correction of the new term.

Despite the temporary collapse, markets began to recover rapidly starting in mid-April. Subsequent statements from the Trump Administration, indicating possible tariff moderation and greater fiscal clarity, helped restore confidence. By June, the S&P 500 and the Nasdaq had already reached new record highs, while the Dow was holding near its record levels. This recovery was driven by solid corporate results, relief—talk and negotiation—in international trade tensions, expectations of rate cuts by the Federal Reserve, and a still-strong consumer environment in the US.

On an annual basis, everything is improving further

In terms of net performance so far in 2025, all three indices show positive results. The S&P 500 is up about 6.4% for the year, the Nasdaq has gained 6.6% and the Dow Jones is up about 4.3%. Volatility has been high, but economic fundamentals remain solid. Conservative investors and managers such as Goldman Sachs or Bank of America continue to forecast further rises for the S&P (to almost 7,000 points), supported by corporate earnings growth and an expansionary cycle in public spending and infrastructure.

Global impact: Europe and emerging markets take center stage

While the US implements its new national economic strategy, the international markets have attracted capital in search of short-term stability:

Germany (DAX): +12% in 2025.

China (MSCI China Index): +21%.

Mexico (iShares MSCI Mexico ETF): +28%.

Eurozone(Euro Stoxx 600): +14%.

Analysts argue that this is a temporary strategy while trade and monetary redistribution policies driven from Washington stabilize (iShares MSCI Mexico ETF).