The Trump Trade has changed. Here are the 6 big themes for investors to watch.
Analysts at Ned Davis Research this week said they recently revised their Trump Trade Index — an index of investment themes they believe will benefit from Trump's agenda.
The firm's original Trump Trade Index included investment themes like space and reshoring, as well as bitcoin and Trump Media & Technology Group, the parent company of Trump's social media network.
"When we created our initial Trump Trade index prior to the 2024 election, we had only a general idea of Trump's agenda and key themes impacted," strategists wrote in a report on Wednesday. "However, after reviewing 170 executive orders, the One Big Beautiful Bill Act (OBBBA), and an ever-changing foray into tariffs, we have a much better indication of agenda priorities."
Markets have been surprised by how Trump's policy agenda has shifted so far this year. US stocks soared after Trump secured his second term in office, before embarking on a wild roller coaster ride as Trump announced his worldwide tariff package and negotiations dragged into this summer.
Trump-era playbook.
Defense
Thesis:
Trump signed a slew of executive orders supporting aerospace innovation and the drone, cybersecurity, and shipbuilding industries in the US.
The GOP tax and spending bill has also earmarked around $150 billion for overall defense spending, $29 billion to shipbuilding, and $170 billion for border enforcement. The bill also has a $24 billion budget to help build the Golden Dome, an ambitious defense system that aims to put American anti-missile weapons into space.
Factors like China's military advancement and the ongoing conflict between Russia and Ukraine also raise the risk that the US could become more involved in geopolitical conflict, strategists suggested.
"While several themes look overbought, some are sure to have staying power over Trump's term. Unfortunately, we believe Defense could have staying power," the report said.
Metals & Mining
Thesis:
Trump has also signed executive orders supporting the copper and rare minerals industry in the US. Meanwhile, the Big Beautiful bill includes tax incentives that support energy exploration in the US, which could also boost the metals and mining industries.
The president has also proposed steep tariffs on key commodities, like steel, copper, and aluminum.
The metals and mining theme was on display already in the last week, when the Department of Defense announced a large stake in rare earth miner MP Materials. The stock surged on the news that the Pentagon would become the company's largest shareholder as it tries to strengthen America's position in a critical supply chain.
Traditional, Nuclear, and Hydrogen Energy
Associated Press
Thesis:
Energy was a cornerstone of Trump's campaign, and the president quickly declared a National Energy Emergency at the start of his term.
"While Biden's agenda promoted Clean Energy, Trump clearly favors Traditional Energy, evidenced by orders to tap Alaska resources, remove production barriers, and promote Coal," strategists wrote.
Uranium and Hydrogen energy are also in focus, the strategists added, pointing to "massive datacenter electricity demands."
Trump has also proposed various tariffs that could raise energy prices, like tariffs on Canadian and Venezuelan energy, a 7.5% tariff on Uranium, and a 10% tariff on hydrogen-related goods.
Bitcoin & Digital AssetsThesis:
Trump, who branded himself as the "crypto president" on the campaign trail, has made a series of pushes into digital assets this year.
Early in his second term, he signed an executive order that aimed to support the US's dominance in digital finance, and another that established a strategic bitcoin reserve.
Lawmakers are also set to pass a slew of new crypto-related legislation this week, like the Senate's landmark stablecoin bill, the CLARITY Act, and the Anti-CBDC Surveillance State Act.
Artificial Intelligence
Thesis:
Trump's executive orders and a handful of provisions in the One Big Beautiful Bill Act are aimed at bolstering AI development in the US, The GOP tax and spending bill includes a $250 million budget for AI-driven cyber defense, as well as tax incentives for chipmakers to build their tech in the US.
Trump also announced a $500 billion AI infrastructure project in January, which involves Softbank, OpenAI, and Oracle building more data centers in the US. This week, Trump announced another $90 billion in AI and energy investments at an event in Pennsylvania.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
11 minutes ago
- Yahoo
Michelin posts H1 sales in line with market forecasts
By Mathias de Rozario (Reuters) -French tyre maker Michelin reported a 3.4% decline in sales in the first half of the year, in line with market expectations, as a fall in sales volumes was partly offset by higher selling prices. The group confirmed its previous guidance for the full year, in the absence of any further deterioration in the economic environment in the second half of the year. WHY IT'S IMPORTANT Michelin's business continues to be impacted by a slowdown in the automotive market, especially in Europe. The group, which, at the end of last year, employed more than 23,500 people at its production sites across the U.S. and Canada has, since March, been facing tariffs imposed by U.S. President Donald Trump. It is looking at accelerating investments in the United States to counter the impact of tariffs. BY THE NUMBERS Sales fell to 13.03 billion euros ($15.33 billion) in the first half from 13.48 billion euros a year ago. That compared with the forecast 13.08 billion euros in a company-provided consensus. The company recorded a 6.1% drop in volumes, mainly in its original equipment sales. The impact from the U.S. tariffs were around 65 million euros in the first half of the year. They are expected to have an impact of around 200 million euros over the full year. KEY QUOTES "Our results have been severely penalised by the fall in volumes linked to our original equipment activities, whether in the automotive or truck sectors, or in a number of specialities, including heavy goods vehicles, agriculture and infrastructure," , Chief Financial Officer Yves Chapot said on call with journalists. "We have chosen to be as localised as possible, so 70% of what we sell in the United States is made in the United States" he added on the impact of tarrifs. ($1 = 0.8499 euros) Sign in to access your portfolio
Yahoo
11 minutes ago
- Yahoo
Brazil's WEG expects to mitigate most impacts from Trump tariffs
SAO PAULO (Reuters) -Brazilian motor maker WEG said on Thursday it expects to offset most of the impact from the 50% tariff U.S. President Donald Trump said he would impose on Brazilian goods partly by adjusting some export routes. Analysts have cited WEG - whose motors are used in vehicles, wind turbines and power transmission lines - among the most exposed firms to the steep tariffs, which are due to take effect on August 1. The company on Wednesday reported lower-than-expected second-quarter results, noting that geopolitical uncertainties have limited long-term visibility and led some clients to postpone investment decisions for large projects. Chief Financial Officer Andre Rodrigues suggested on Thursday the firm could use its Brazilian operations to supply countries such as Mexico and India, whose products would in turn meet U.S. demand. "The execution may take a few months, but once the change is implemented, we expect to be able to mitigate most of these impacts," he told a call with analysts, though warning the move would also depend on the levies Trump imposes on other nations. WEG has plants in over a dozen countries, including the United States and Mexico, and has touted its global presence and broad product portfolio as factors that might help shield it from the tariffs' impacts. Rodrigues said that products made in Brazil currently account for less than a third of WEG's U.S. sales. He noted that the effects on WEG's second-quarter results of the 10% tariff Trump had initially imposed in April were small, saying that the firm made some price adjustments in the U.S. to offset the impact of those levies. "Looking ahead, at this point it's not possible to have a firm stance, given the many uncertainties and volatility in the trade structures being discussed," Rodrigues added. "But if the current situation persists, WEG does have an action plan."
Washington Post
11 minutes ago
- Washington Post
Democrats demand U.S. investigation of American's death in West Bank
Nearly 30 Senate Democrats are urging the Trump administration to investigate the recent death of an American citizen in the West Bank. In a letter addressed to Secretary of State Marco Rubio and Attorney General Pam Bondi on Thursday, the senators criticized what they labeled a 'culture of impunity when it comes to incidents where civilians have been killed in the West Bank, including Americans.' Sayfollah Kamel Musallet, 20, of Tampa, was killed July 11 while visiting family in the occupied West Bank. Palestinian health authorities and Musallet's family have said Israeli settlers are responsible for his death. Shortly after Musallet was killed, the Israel Defense Forces said it was examining reports of a death during a confrontation between Israelis and Palestinians in the area. Spokespeople for the Israeli embassy in Washington and the Justice Department did not immediately respond to requests for comment. The State Department declined to comment. The senators' letter, a copy of which was obtained by The Washington Post, was signed by 29 lawmakers, accounting for more than half of the chamber's Democrats. No Republicans have joined the effort. Three other Palestinian Americans have died in the West Bank since the Israel-Gaza war began in October 2023. Democratic members of Congress have objected to the wave of settler violence, arguing that American citizens are falling victim. The U.S. government 'has failed in its responsibility to protect American citizens overseas and demand justice for their deaths,' the letter states. Sen. Chris Van Hollen (D-Maryland), the letter's lead author, has called for similar investigations in the past. He has emerged as a vocal critic of settler violence and the Israeli government's response to it. His office shared responses to similar requests made of the Biden administration, which show officials offered little further information about the deaths but committed to speaking with Israel's government about them. At a Senate hearing earlier this month to evaluate President Donald Trump's nomination of Michael Waltz, the former White House national security adviser, to become ambassador to the United Nations, Van Hollen criticized the Trump administration's decision to revoke sanctions imposed by the Biden administration targeting Israeli settlers in the West Bank whom the U.S. government at the time deemed extremists. 'When you withdrew that executive order, you sent a very bad signal,' Van Hollen said then. An April analysis by the Washington Institute, a think tank, found that Israeli settler violence has surged in the last year, rising 30 percent in the first part of the year, compared with the same period the year before. Meanwhile, Palestinian terrorism in the same area has sharply declined, the analysis found. 'The increase in settler violence at a time when Palestinian terrorism is decreasing lends credence to the assessment that settler attacks are not simply a response to terrorism, as some have claimed,' the study's author, Neomi Neumann, wrote. The Trump administration has taken a complicated approach to Israel since entering office in January. At times, it has shown frustration with Israeli President Benjamin Netanyahu for the inability to reach a peace deal in Gaza, which has been afflicted by violence and famine nearly two years into the war. Notwithstanding, top Israeli officials have visited Washington multiple times in the last six months, and Trump authorized the U.S. military to join Israeli forces in an attack on Iran's nuclear program in mid-June, fulfilling one of Netanyahu's core priorities. Heidi Levine, Miriam Berger and Marie-Rose Sheinerman contributed to this report.
