Trade-War Threats Weigh On The Market

A tilt toward domestic-focused stocks makes sense for most investors.

- Anne Kates Smith

Is a trade war about to bring out the worst in this stock market? So far, the strong economy and robust corporate earnings have been enough for the market to withstand a protectionist onslaught. But investors should expect the volatility to continue, and new market highs could be on hold for now.

The U.S. is currently at odds with six of its top seven export markets, accounting for more than half of American exports. The Trump administration has imposed tariffs on $50 billion of Chinese imports, has begun the tariff process for an additional $200 billion of Chinese goods and has threatened tariffs on even more—to the tune of some $500 billion in total.