The Trump 100 days market impact began with optimism—but soon exposed deep market vulnerabilities.
At first, the market reaction to Trump’s return was undeniably positive.
Tax cuts, deregulation, infrastructure investment—on the surface, it looked like a textbook pro-market agenda.
And indeed, the market responded to those very promises with enthusiasm.
Investors cheered:
“Trump’s cutting taxes!”
“He’s rolling back regulations!”
“Infrastructure spending is coming!”
But three months in, something changed.
The faces of investors watching the news began to tighten.
“Wasn’t this supposed to be good? So why does it feel so unstable?”
Despite the rollout of seemingly market-friendly policies, investor sentiment quickly cooled. This article explores that very question—how optimism turned into anxiety in just 100 days.
🇰🇷 This article is also available in [Korean version]
1. Policy-by-Policy Breakdown of Trump’s First 100 Days
Policy shapes sentiment, and sentiment drives the economy.
In January, optimism swept through financial markets.
But by April, both consumer confidence and business sentiment were falling fast.
1-1. Early Optimism: Key Drivers of the Trump 100 Days Market Impact
- Tax Cuts
- Trump’s major tax reform proposals were met with investor enthusiasm.
Corporate tax reductions and middle-class tax relief fueled expectations of stronger earnings and consumer spending.
As a result, consumption picked up and stock prices climbed—especially for domestic-oriented firms and financials.
- Trump’s major tax reform proposals were met with investor enthusiasm.
- Deregulation
- Looser regulations across banking, energy, and environmental sectors promised lower business costs.
Bank stocks surged more than 10% at one point, and energy stocks rebounded on renewed shale gas optimism.
- Looser regulations across banking, energy, and environmental sectors promised lower business costs.
- Infrastructure Investment
- Massive infrastructure pledges—covering roads, bridges, and airports—lifted construction and materials stocks.
Even though no bills were passed, the market priced in these expectations ahead of time.
- Massive infrastructure pledges—covering roads, bridges, and airports—lifted construction and materials stocks.
1-2. A Shift in Sentiment: From Optimism to Alarm
- Tariffs and Protectionism
- Then came the turning point.
In early April, Trump announced a blanket 10% tariff on all global imports.
This triggered chaos: disrupted supply chains, capital flight from emerging markets, stock plunges, and currency instability.
Investors began to see this as the true “Trump risk”—a surge in policy uncertainty that drove rapid flight from risk assets.
- Then came the turning point.
- China Strategy
- Tariffs as high as 125% were imposed on Chinese goods, officially igniting the U.S.-China trade war.
Sanctions on Chinese tech firms, aggressive tariff hikes, and explicit “decoupling” rhetoric pushed the conflict into overdrive.
China’s stock market fell over 6%, and the yuan broke past the symbolic 7.20 level per dollar.
- Tariffs as high as 125% were imposed on Chinese goods, officially igniting the U.S.-China trade war.
Consumers began to feel the pinch of rising prices, while companies grew cautious about capital investment due to surging raw material costs.
- U.S. Conference Board Consumer Confidence Index: Dropped for 5 straight months, hitting a 5-year low of 86.0 in April
- Expectations Index: Fell to 54.4, the lowest since 2011
- Gallup Poll: 53% of respondents expected their finances to worsen—worse than during the 2008 crisis
1-3. Good Policies, Bad Delivery
The policies themselves weren’t the issue. It was the delivery.
Markets dislike unpredictability—just like people do.
While Trump’s intentions were pro-market, his impulsive style overshadowed those goals.
Sudden tariffs.
Sudden sanctions.
Sudden press conferences.
Investors retreated, choosing to wait and see.
Policies like tax cuts and deregulation rely on confidence and expectation.
But for that to work, clear and consistent communication is key.
Instead, Trump’s off-the-cuff announcements undermined trust.
Hope turned into hesitation.
2. China Strategy and the Global Decoupling Shift
The sweeping tariff plan announced in April wasn’t just a policy—it was a geopolitical shock event.
2-1. Market Response to China-Focused Policies
From day one, Trump targeted China.
Beyond tariffs, he introduced sanctions on Chinese tech firms, restrictions on technology transfers, and tighter IPO scrutiny—initiating a full-fledged decoupling strategy.
The Chinese stock market plunged over 6% in a short period, and the yuan sharply weakened.
Investors began to feel that even the U.S. was becoming unpredictable.
The risk of long-term U.S.-China conflict prompted global investors to pull back significantly.
2-2. Capital Flight Across Emerging Asia
The damage didn’t stop with China.
Tariff shocks spread throughout Asian emerging markets:
- Sharp declines in Hong Kong, Taiwan, and South Korea stock markets
- Accelerated capital outflows and currency weakness
- Some indices dropped to levels last seen during the early COVID-19 pandemic
This was no longer just about trade—it marked a deeper regional uncertainty.
When political motives override economic logic, markets get nervous.
Protectionism may please domestic voters, but it sends all the wrong signals to financial markets.
Global capital flows to predictability, not political turbulence.
3. Shifting Sentiment: How Consumers and Companies Reacted
Why did market sentiment deteriorate despite “good” policy headlines?
Because even good policy only works when it’s credible.
Trump’s promises sounded great, but the market didn’t believe in their execution.
That’s what froze investor sentiment.
3-1. How Sentiment Shifted During the Trump 100 Days Market Impact
After Trump 2.0 launched in January, confidence metrics fell sharply.
Uncertainty was immediately reflected in consumer spending.
- Conference Board Consumer Confidence Index: Down to 86.0 in April—lowest in 5 years
- University of Michigan Consumer Sentiment Index: Fell 29%, lowest since the 2000s
- Business Expectations Index: Dropped to 54.4, the lowest since 2011
3-2. Business Sentiment and Employment Metrics
The NFIB Small Business Optimism Index also declined, driven by worries over rising input costs.
That said, labor metrics remained stable—for now:
- Q1 nonfarm payrolls: +345,000 jobs
- Unemployment rate: Steady at 4.2%
Still, early signs of a negative feedback loop were visible—
Sentiment → Lower spending → Weaker investment → Pressure on jobs.
Corporate bond spreads widened, and the yield curve showed signs of inverting.
3-3. Hard Data Lags—Sentiment Leads
In economics, sentiment shifts before the data.
People had already closed their wallets before numbers caught up.
- Q1 GDP growth: Annualized 0.3%, the lowest since 2022
- Caused by pre-tariff stockpiling and consumer pullback
Even as unemployment remained okay, the broader data painted a slowing economy:
- Slower consumer spending
- Shrinking net export contribution
- Weakening capital investment
Bond markets signaled rising risk aversion through widened credit spreads and a flattening curve.
The key message: numbers trail behind.
The market reacts to the feel before the facts.
4. Market Timeline: Key Headlines from January to April
4-1. Events and Their Impact at a Glance
- Jan 20 – Trump Inaugurated: S&P 500 hits record high, dollar strengthens
- Feb 28 – Tax Cut Hints: Tech and industrials rally, long-term yields rise
- Mar 15 – FOMC Meeting: Rate on hold, dovish Fed tone
- Apr 2 – Global Tariffs Declared: Dow falls 4.7%, gold and yen surge
- Apr 5 – Tariffs Take Effect & US-China Clash: Asian stocks plunge, yuan slides
- Apr 9 – Partial Tariff Delay, China Pressure Mounts: Dollar rebounds, stocks recover briefly
- Apr 30 – Weak GDP Data: Confidence hits bottom, slowdown fears mount
4-2. From Tweets to Tumbles: Explaining the Links
Markets weren’t just reacting to policy—they were reacting to how policy was communicated.
Unclear direction and constant surprises drove investors into caution mode.
5. The Market Is Made of People—And People React to Emotion
Trump’s first 100 days sent shockwaves through global markets.
The biggest lesson?
It wasn’t the policies themselves—it was the loss of trust in how decisions were made.
The policies were pro-market on paper.
But the market doesn’t just analyze—it feels.
“He might change his mind.”
“He could announce something without warning.”
“Better to move to safety.”
That was the prevailing mindset.
So what can we take away?
- Even pro-market policies like tax cuts and deregulation are useless without consistency.
- Emotions move faster than data—fear comes first.
- Sentiment can override fundamentals—if the mood is bad, the market drops anyway.
- Without diversification and risk management, Trump-driven rallies are hard to ride.
- By the time risks become obvious, smart money may have already exited.
We’ve entered a high-volatility phase—where one Trump tweet can move the entire market.
Now more than ever, we need structured portfolio strategies—not reactions to headlines.
Conclusion
In a time of extreme volatility, reacting to every headline is dangerous.
Instead, diversify, stay flexible, and plan around policy risk.
We now live in a market where Trump’s words, not just his actions, move capital.
If you’re a serious market observer, this is your new normal.
Even a single sentence from the president can move trillions.
Learn to read beyond the news—look at the underlying structure, not the noise.
This series may end here, but the “Trump risk” story isn’t over.
Markets will continue to shake at every new twist.
So hold onto what you’ve learned—this won’t be the last time.