U.S. Effective Tariff Rate A 19% rise in the effective U.S. tariff rate would significantly slow economic growth and sharply increase recession risk, with broad spillover effects on inflation, employment, and overall business confidence. Image: Goldman Sachs Global Investment Research
U.S. Equities – 12-Month Forward P/E Ratio and Share Prices Market optimism is fueled by hopes of resolving trade and geopolitical risks, but high S&P 500 valuations increase vulnerability. Without resolution or robust earnings growth, the risk of a market pullback rises. Image: Deutsche Bank
S&P 500, as Reported EPS and Forecast Analysts currently do not anticipate an outright profit downturn for corporate America, but compelling reasons suggest that earnings growth may slow, particularly due to the impact of tariffs. Image: TS Lombard
Share of U.S. Corporate Profits from Foreign Markets Foreign markets account for 13% of US corporate profits, while emerging markets contribute 4%. Yet, trade uncertainties and recent tariffs may threaten these contributions moving forward. Image: Goldman Sachs Global Investment Research
Monthly Number of U.S. IPOs and S&P 500 The IPO market’s rebound in 2025 is a clear signal of renewed risk appetite and a progressing market cycle, with investors showing strong demand for new equity issues. Image: Topdown Charts
Inflation – U.S. CPI Deviation from Consensus A series of lower-than-expected inflation readings gives the administration greater economic leeway to pursue higher tariffs, driven by the (possibly mistaken) belief that U.S. consumers will be largely insulated from their effects. Image: Deutsche Bank
S&P 500 – Share of Sales Derived from Outside United States The “Magnificent Seven” tech giants are more exposed to global trade risks than the rest of the S&P 500, as 49% of their revenue comes from foreign sales. Image: Goldman Sachs Global Investment Research
S&P 500 – Cumulative Total % Return of the Top 10 U.S. Companies Since 2000, maintaining dominance and consistently beating the S&P 500 has eluded almost all top-ten stocks except for rare cases like Microsoft. Current market leaders could defy history, but past evidence suggests it’s a high bar. Image: Deutsche Bank
S&P 500 Index Returns in July Historically, the U.S. stock market tends to peak around this time in July. Given both seasonal and technical patterns, it would be perfectly normal for the current powerful 26% rally off the April lows to take a pause. Image: Carson Investment Research
S&P 500 Cycle Composite The S&P 500 Cycle Composite points to a less bullish period of the year, with 2025 so far following typical seasonal patterns: early strength, mid-year volatility, and a potential year-end rally. Image: Ned Davis Research
Return on Equity (ROE) : S&P 500 vs. MSCI World ex. U.S. U.S. stocks have significantly outperformed their global peers in recent years, driven by the superior return-on-equity of American companies—a key factor reinforcing the structural advantages of the U.S. market. Image: Goldman Sachs Global Investment Research