Axios: “Trump trades” are Falling Across Markets

March 6, 2025

As markets react to shifting economic conditions and investor sentiment sours on assets tied to President Trump, stocks and other financial instruments associated with his policies have started to decline. While many of these assets surged in anticipation of his presidency, the recent downturn raises questions about whether the so-called “Trump put”—his tendency to reverse policies that upset markets—will reemerge, or if Trump’s second term will bring a different approach.

Michael Landsberg, Chief Investment Officer at Landsberg Bennett Private Wealth Management. notes that the selloff is being driven by more than just tariffs. “The tariffs alone aren’t enough to hurt the economy in a noticeable way, but when you take tariffs, plus broader worries about the economy, and a Fed that still might take its time on lowering rates, that’s when you start to wonder if the record highs in stocks from earlier this year were justified,” he told Axios.

Key Takeaways:

  1. Trump-Linked Stocks Are Struggling: Stocks that previously surged on hopes of favorable Trump administration policies have sharply declined. Companies linked to defense, technology, and private sector contracting have all seen losses over the past month, with some significantly underperforming the broader market.
  2. Market Sentiment Has Shifted: The enthusiasm that fueled market gains in the early months of Trump’s return has given way to concerns over economic growth and policy execution. Investors are now reassessing whether initial expectations were overly optimistic.
  3. Recession Worries Are Mounting: Treasury yields have fallen, a signal that investors are seeking safer assets amid economic uncertainty. While lower yields might align with administration goals, they are more reflective of growing fears about slowing economic growth rather than confidence in stability.
  4. Crypto and Alternative Assets Are Declining: Despite Trump’s positioning as a supporter of digital assets, cryptocurrencies, including Bitcoin and Trump-affiliated meme coins, have also seen declines. The initial rally sparked by policy discussions around a national crypto reserve has faded.

The market’s initial optimism surrounding a second Trump presidency appears to be giving way to a more cautious stance as economic concerns take center stage. With uncertainty around tariffs, Federal Reserve policy, and broader market stability, investors are now questioning whether the early-year stock market highs were sustainable. If economic conditions continue to weaken, the administration’s response—and whether or not it prioritizes market stability—will play a key role in shaping future investor sentiment.

Learn more here: https://www.axios.com/2025/03/06/trump-trades-musk-tesla-bitcoin

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