On tariffs, we didn’t learn too much in the way of new information after the prior week’s avalanche of Industrials earnings. With a heavier dose of Tech companies taking the spotlight from the Industrials sector, the tariff discussions overall seemed a bit less front and center as well.
Positive comments on tariffs tended to emphasize mitigation strategies, footprint adjustments either in the future or the past, pricing, USMCA compliance, and an ability to manage through. More negative comments tended to center on fluidity of the policy backdrop, heightened uncertainty, and a difficulty in knowing where the policy will settle.
We don’t have a great feel for the exact contours at the moment, but have been paying close attention to discussions of the timing of impacts for when mitigation strategies go into effect or stop having an impact.
We’ve also been paying close attention to whether companies are talking about a pull-forward of demand, a pause in demand/decisions, or delays, and for now the discussion still seems to be that all of the above are happening. Sequencing and timing are likely to be in focus in the next reporting season.
