What explains the durability of the post-liberation day equity rally? How will the Moody’s Ratings downgrade of U.S. debt affect bond markets? And will balanced portfolios offer global investors adequate diversification going forward?

In this episode, Northern Trust Wealth Management CIO Katie Nixon and Northern Trust Asset Management Head of Tactical Asset Allocation Peter Wilke take the pulse of global markets following the furious rebound in risk assets from their early April lows.

Katie and Peter discuss the state of tariff negotiations and the varying impacts they will have on U.S. corporate earnings. They outline the reasons for outperformance of non-U.S. equities—particularly for dollar-based investors—including improving governance trends in emerging markets. They then turn to the outlook, including which U.S. sectors may be more resilient, how U.S. fiscal strategy may impact bond markets, and how investors can pursue portfolio diversification and battle inflation in the balance
of 2025.

(1:38) What factors drove the 90-day pause in elevated tariffs, and what is your base case for where tariff rates will end up?
(5:51) Will tariffs have a greater impact on S&P 500 earnings than they will on the broader U.S. economy?

(7:13) - What has driven the outperformance of non-U.S. equities this year?
(12:18) - How has the weaker dollar affected returns for U.S. based investors?
(14:05) - What is the case for investing in emerging markets today?
(17:49) - What is the outlook for U.S. equity markets, and what segments are most attractive?
(20:50) - What are the biggest risks to U.S. equity markets?
(23:02) - How will U.S. fiscal strategy and a weakening growth environment affect the outlook for bonds?
(29:01) - Will bonds be a good portfolio diversifier in the future, and what is the role of TIPS?

A Post-Liberation Day Reset

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