US stocks have climbed off the lows that followed President Donald Trump’s “Liberation Day” tariff rollout, but a year later, advisors looking for a clean “tariffs = US winners” trade are left with a messier record: uneven equity leadership, persistent goods-price pressure and a business climate shaped by shifting rules and higher uncertainty.
On April 2, 2025, Trump announced country-specific import duties that included 34% on Chinese goods, 20% on the EU and 46% on Vietnam. The announcement was followed by panic and turbulence across global markets,” with US stocks, Treasurys and the dollar all getting hit in what came to be known as the “Sell America” trade.
The US stock market recovered, but not as decisively as it had in many post-2009 periods when global investors routinely treated America as the geographic exposure of choice. Reporting by CNBC points to how benchmark indexes in Brazil, the UK and Japan have outperformed the S&P 500 in the year since Liberation Day, as investors – particularly outside the US – sought to diversify away from an overreliance on American returns.
The equity-market narrative has been reinforced – and complicated – by the macro data that came in behind it. One of the administration’s core claims was that tariffs would catalyze a wave of investment and a revival in factory employment. But an analysis by the Tax Foundation did not show a dramatic investment surge in the broad macroeconomic data. Foreign direct investment into the US totaled $288.4 billion in 2025, lagging the prior 10-year average of $320.7 billion and below annual totals in 2021 through 2024. It also reported manufacturing employment declined by 89,000 jobs between April 2025 and February 2026, a drop it said was broadly consistent with pre-existing trends.
For advisors, those figures matter because they help frame why US equity leadership has looked less decisive than historically: a tariff-driven boom in capital spending and factory hiring – the sort of macro impulse that can broaden earnings growth beyond a handful of mega-cap themes – has been hard to spot in the aggregate.
Inflation is the other channel that has kept Liberation Day in the market conversation. Citing research from the Pricing Lab at Harvard, the Tax Foundation said that through October 2025, tariff pass-through to retail prices reached 24%, contributing a cumulative 0.76 percentage points to Consumer Price Index inflation. It also pointed to Federal Reserve research suggesting that price pressure developed gradually as retailers adjusted over time, rather than appearing as a one-time jump.
The Cato Institute’s year-one review points to similar conclusions on prices – and to a second factor that can matter for both earnings visibility and valuations: uncertainty. Cato wrote that tariffs “undeniably increased prices for American importers and consumers,” citing research that found tariff costs passed through to prices paid by Americans at rates “as high as 96 percent.” It also said tariffs increased the prices of tariffed goods last year and that they “remain elevated today.”
On uncertainty, the think tank said the dozens of changes to US tariffs that the president enacted or threatened helped push trade policy uncertainty to “an all-time high” in 2025. A body of proof consisting of business surveys and anecdotal evidence strongly suggests that uncertainty undermined long-term business planning and investment in the US.
In February, Trump's across-the-world tariffs were struck down by the US Supreme Court, which ruled that the International Emergency Economic Powers Act (IEEPA) – which the President had invoked to justify those levies – “does not authorize the President to impose tariffs.” That hasn't stopped him from doubling down on his conviction around protectionist trade policy, immediately pivoting toward a new global tariff that he insisted would help usher in a new "golden age" for the US – though not everyone is so sure.
"There’s still much we don’t know about US tariff policy going forward, but there’s certainly one thing we do: While the “reciprocal tariffs” may be dead, the administration’s protectionism will – barring congressional intervention – unfortunately persist," the Cato Institute said.
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