Trump Gives Trade War a Break: Who Won, Who Lost?
Suspending tariff increases against China, except China, benefited the tourism sector the most from Trump’s move. The biggest loser of Trump’s move was China.
US President Donald Trump suspended his trade war with China for 90 days after escalating it step by step since he officially took office for the second term on January 20.
Lin Ji, China’s Ministry of Foreign Affairs Spokesperson, stated that Beijing is not interested in conflict but if the US continues its threats, China will not be afraid even though China does not want to participate.
So, who were the winners and losers of Trump’s “break”?
WHO WON?
According to Business Insider, tourism companies were the firms that gained the most value in the market after the decision. The shares of United Airlines by 26%, and Delta Airlines’ shares increased by 23% after the decision.
Cruise line companies also profited in a similar way. Norwegian Cruise Line Holdings increased by 19%, Carnival Corp by 18%, and Expedia Group by 18%.
Amir Eylon, President and CEO of Longwoods International, a travel and tourism market research-consulting firm, explained that not only airline companies but all trade brands were winners on Wednesday, April 9 on Wall Street.
According to Eylon, the major concerns for travel companies were the rise in supplier costs due to tariffs and the potential decrease in travel expenses caused by rising prices.
SEMICONDUCTOR COMPANIES ALSO WON
Considering the increase in stock values, Intel, Nvidia, and other semiconductor companies were among Trump’s last move’s biggest winners. Both Intel’s and Nvidia’s shares increased by approximately 18%.
Although semiconductors or chips were exempt from tariffs, news reports earlier this week indicated that other components in products using chips could be affected by tariffs.
A FAMILIAR NAME ON THE LIST: ELON MUSK
After Trump’s decision, Tesla’s shares owned by billionaire businessman and one of Trump’s consultants, Elon Musk, also rose by 22% in the stock market. Musk and Tesla were among the winners of this new decision, mostly due to the increase in share prices.
On the other hand, Musk himself criticized the tariffs of late and targeted Peter Navarro, Trump’s top adviser, in this regard.
EXPECTED NAME IN THE LOSERS LIST: CHINA
China, exempted by US President Trump from the recent “break,” was among the losers of this process.
According to Meagan Martin-Schoenberger, Senior Economist and Trade Expert at KPMG, and other economists, the tariff hike for China actually resulted in an increase in the effective tariff rate.
AMAZON ALSO LOST
While Amazon’s share value increased by around 12% on Wednesday, the increase in tariffs on Chinese products could be bad news for Amazon because most of the products sold on the platform come directly from China or through third-party sellers.
Previous reports indicated that Amazon could be the most vulnerable online trading company against Trump’s tariffs according to Morgan Stanley, due to the sale of products from China.
