Unlocking Market Insights: How Solid Earnings Could Conceal Tariff Turbulence in the Coming Weeks

In less than two weeks, on August 1, investors are keeping a close eye on the potential new tariffs introduced by former President Donald Trump. Surprisingly, the markets seem unbothered. Recently, while the Dow Jones dipped slightly, the S&P 500 rose by 0.6% and the Nasdaq Composite gained 1.5%.

Even when reports suggested tariffs on the European Union could rise to between 15% and 20%, the markets remained stable. These rates are above the expected 10%, yet lower than the 30% that Trump had previously hinted at.

An encouraging earnings season is helping calm tariff-related fears. According to FactSet, around 83% of S&P 500 companies that reported their earnings exceeded expectations. Major banks like JPMorgan Chase and Goldman Sachs showed strong results, boosting investor confidence.

Next on the radar are the earnings from Big Tech, set to be released just before August 1. If they surpass predictions, it could further ease geopolitical anxieties or lead investors to minimize trade concerns. Nonetheless, it’s important to remain cautious—silver linings often come with clouds.

A noteworthy trend is the impact of tariffs on international businesses. For instance, European exporters, such as those from Ireland, are feeling the strain. Recent reports indicate a potential tariff hike threatens exports ranging from Irish whiskey to Italian cheese. Businesses like Skellig Six18 in Ireland, which began exporting to the U.S. in 2024, are now faced with uncertainty in their markets.

According to a recent survey by McKinsey, 70% of companies anticipate their supply chains will be affected by increasing tariffs. This could lead to price hikes that consumers might feel in their wallets.

In today’s quickly changing economic landscape, investors and businesses are adapting. Understanding these shifts is key as the deadline approaches.

For those interested in more detailed insights on tariffs and their effects, you can read a comprehensive report on the impact of U.S.-EU trade relations here.

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