Greetings, readers! I appreciate all the feedback on last week’s article about tariffs, trade tensions, and US stock market volatility.
This week, I want to build on that discussion with a fresh look at what’s moving the US equity markets right now—especially the new steel tariffs, rising geopolitical risks, and how I’m adjusting my investment approach.
As always, if you find these insights helpful, please subscribe to my Streetwise Economics YouTube channel at https://tinyurl.com/5ydrzdxb and sign up for my weekly newsletter or book 1:1 coaching at www.streetwiseeconomics.com. As always, in this article I share what I am comfortable doing and now what you should do.
The US market has seen renewed volatility after President Trump’s announcement doubling steel tariffs from 25% to 50%.
This policy shift is aimed at protecting US industry but has rattled global markets and reignited trade tensions with major partners.
Steel stocks like Cleveland-Cliffs jumped, while industries relying on steel—such as automakers and construction—are now facing higher costs and new supply chain challenges.
But tariffs are just one piece of the puzzle. The market mood is also being shaped by a sharp rise in geopolitical risks—especially the conflict between Ukraine and Russia.
I am not a geopolitical expert, but what happened recently—Ukraine’s significant strike on Russian territory—crossed what I see as a red line.
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In my view, this raises the likelihood of a strong Russian retaliation and if that happens, it could hit US and global financial markets hard.
It’s a scenario I’m watching closely and it’s a good reminder that markets can swing on global news as much as on economic data.
Given this environment, I’m making some changes to my approach compared to last week:
Increasing my hedge:
For the first time in a while, I’ve added a small position in my usual hedge—the VIX ETF. With volatility likely to spike if the Ukraine-Russia situation escalates, this gives my portfolio some protection.
Locking in gains:
Some of my positions have had strong runs recently. I’ve trimmed profits in these names to lock in gains, rather than risk giving them back if the market turns sharply.
Keeping cash ready:
I’m holding more cash than usual. With so much uncertainty, cash gives me flexibility to buy quality stocks if we see another sharp dip.
Staying selective and defensive:
I’m still focused on companies with strong balance sheets and resilient earnings, but I’m avoiding sectors most exposed to steel tariffs and global shocks.
Why geopolitics matter now
The Ukraine-Russia conflict is a major risk factor. If Russia retaliates in a big way, I believe we could be heading into dangerous territory for global markets. This is not a prediction—nobody can know for sure—but thinking in scenarios helps me prepare for what might come. That’s why I’m hedging and staying nimble.
Final thoughts
Markets are unpredictable, especially with policy shifts and geopolitical risks in play. My approach—hedging, trimming profits, and keeping cash—helps me stay prepared for whatever comes next. Remember, this is just what works for me. Please do your own due diligence and consult a financial advisor before making any investment decisions.
Always trade and invest wisely, and until next time - may the markets be on your side!
*Isaac Jonas is an economist based in Canada and Principal consultant at Streetwise Economics. He is also a retail investor, retail trader and content creator, focusing mainly on the US and Canadian capital markets. He regularly shares insights via his social media handles and YouTube Channel (Streetwise Economics). His website is www.streetwiseeconomics.com and can be reachable on [email protected]. Disclaimer: This article is for educational purposes only—not investment advice. Markets are personal; what works for me might not for you. Consult a financial advisor before acting. Let’s keep learning and adapting—together.
