Tariff uncertainty muddies — and refocuses — earnings season: Morning Brief

The Takeaway from today’s Morning Brief is clear: bankers played a significant role in convincing the president to pause tariffs. The bond sell-off was a key factor in this decision, prompting the White House to pivot despite days of stock market turmoil. As the big banks kick off earnings season, it is evident that tariff policy and the trade war are top priorities.

Looking ahead, investors are concerned about how Trump’s tariffs will impact corporate profits. Can supply chain adjustments mitigate the effects of levies on China? Will key industries and big-name brands secure exemptions from the White House? It is essential to read between the lines of corporate statements, as companies may be lobbying for special treatment.

Corporate earnings reports have always focused on the future rather than the past. This quarter’s outlooks will carry significant weight, given the uncertainty surrounding tariffs. Analysts have already lowered their earnings estimates for the first quarter, with some predicting a challenging year ahead for corporate profits.

Amidst this uncertainty, transparency from companies may be limited. Executive teams may choose to withhold guidance until there is more clarity on trade policies. Savita Subramanian from Bank of America Global Research highlighted the potential for companies to halt guidance in the face of uncertainty.

As we navigate through these turbulent times, it is crucial for investors to stay informed and adapt to the rapidly changing economic landscape. Stay tuned for more updates on how tariffs will impact businesses and the stock market. Story Continues.