The bank estimated: This is the price the stock market will pay on Trump Cover

Wall Street has not yet been able to recover the AI ​​minor who plagued the markets last week, and another shakes already colored the screens in red. This time it is Donald Trump’s trade war that hit again, after the US president shared the markets and cast a 25% cover on Canada and Mexico and 10% on Chinese goods.

The concerns about Trump’s steps have reflected in all the channels in the capital market: Wall Street the key metrics opened the day-to-2%trading day, the fear index jumped 20%, the price of the Bitcoin plunged to $ 94.9 thousand, and oil prices jumped over 2 to 2 %. The dollar was also strengthened in front of the world coins.

However, later in trading in the markets, he was waiting after US President Donald Trump said he was delaying the new 25% new customs for the United States from Mexico. Prevent drug trafficking.

“There is a risk of 5% drop in the American stock market”

Is it a one -day storm or start of a landslide? The analysts around the world emphasize the negative effects in Trump’s trade war. Bloomberg reported that Goldman Sachs estimates that there is a risk of 5% drop in the US stock market in the US over the next few months, given the fact that Trump’s tariffs are expected to damage corporate profits.

David Costin, a chief strategist in Galodman Sachs, explains that “investors were shocked by Trump’s decision, and watched that the tariffs would only be imposed if the negotiations regarding trade policy would fail.” He adds that the bank’s economists believe that there are reasonable ones that Canada and Mexico cover will only be temporarily imposed.

Costin also explained that in the event that Trump’s tariffs still remain permanent, this is expected to harm the profits of the S&P 500 companies and worsen between 3%-2%, warning that the fair value of the S&P 500 may decrease by about 5%in the near term due to The injury to profits and capital value.

Also in RBC Capital Markets, the strategic Lori Klavsina warned that the possibility of a 5% to 10% decrease in the S&P 500 increased following Trump’s announcement of the tariffs, due to high exposure of investors and high stock assessments.

The January was closed with a S&P 500 with a 2.7% increase in January, but the positive sentiment was impaired by Trump’s policy to be revealed as an inflation. All this happens while the feared that technology shares will be harmed by the fact that the US may not remain a leader in innovation in artificial intelligence.

“Covered on Canada and Mexico probably temporary, in China will remain fixed”

Bank of America also referred to the effects of Trump’s lids. In their review, the economists noted that in their estimation, imposing imports on Canada and Mexico will probably be temporary, but China will remain permanent.

The US Bank notes that there are three reasons why they estimate the imposition of the tariffs on Mexico and Canada is expected to be temporary. “First, the decision ends up harms the US when large corporations have already put pressure on the Trump administration to cancel its decision. Second, the impairment will be difficult to implement in light of the high degree of production in North America. And finally, we think Canada and Mexico are expected to agree to most Trump’s conditions on immigration and drugs. ”

At the same time, Beck America notes that assuming that the coverings on Canada and Mexico will indeed be temporary, the US product harm will be small, but the Fed will still be careful and consider its steps in moderation when it comes to the future of the interest rate outline. The two countries in the GDP and that interest rates in Mexico are expected to rise. As far as China is concerned, they emphasized that the demand in the country will be harmed by Trump’s decision, but the state’s incentive program is expected to help demand to recover.

In their review, the bank’s economists noted that in the scenario where Trump’s cover on the three countries are constantly remained and that the North America’s trade war will be damaged in the US. Its currency value.

Berkelis estimates that there is 45% reasonable that the US Federal Court will stop Trump’s decision. Michael McLean, an analyst Berkelis explains that this is because the tariffs have been imposed under “National Economic Emergency” which Trump declared to enable a new tariff program and that there is a possibility that there is a possibility The court decides that Trump’s steps do not justify the use of the move he has taken.