New Tariff Actions:

The latest round of tariffs has added a fresh layer of uncertainty to global markets, raising concerns about a renewed wave of trade friction. While industries like entertainment and technology are feeling the pressure, the broader impact will depend on how global leaders respond and whether further trade actions are introduced.

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In early May 2025, President Donald Trump introduced a 100% tariff on all foreign-made films, citing national security and a desire to boost the domestic entertainment industry. This decision is part of a broader push for protectionist trade policies, which also includes steep tariffs on Chinese imports, with some rates climbing as high as 145%. These actions directly impact major U.S. media companies like Netflix, Disney, and Warner Bros. Discovery, which depend heavily on global production and international content.

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Market Response:
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Markets reacted negatively to the tariff news:

• Dow Jones Industrial Average dropped by over 200 points (around 0.5%).
• S&P 500 fell by 0.9%.
• Nasdaq Composite declined by 1%.

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Entertainment and tech companies were among the hit:

• Netflix shares dropped 4.7%.
• Amazon slid 1.5%.
• Disney and Warner Bros. Discovery each lost about 2.2%.

Meanwhile, bond yields climbed, with the 10-year U.S. Treasury yield rising to 4.33%. Oil prices also declined to roughly $57 per barrel, after OPEC+ signaled increased production.

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Economic Background:

The U.S. economy contracted by 0.3% in Q1 2025, in part due to a surge in imports ahead of the expected tariffs. The labor market remains strong despite the economic slowdown, with positive job data in April. The Federal Reserve is expected to keep interest rates unchanged at its next meeting, although markets are pricing in potential rate cuts totaling over 100 basis points by the end of the year, depending on how inflation and growth evolve.

Conclusione:

The revival of aggressive trade tariffs and ongoing economic uncertainty have added new headwinds for investors. As inflation, policy decisions, and global trade tensions intersect, markets will likely remain volatile. Diversification and closely monitoring policy developments will be essential strategies for navigating the months ahead.

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