On 2 April, President Trump announced sweeping tariffs on nearly all of the US’s trading partners.
The need for tariffs was a staple in his election campaign. The promise was that imposing tariffs on other countries would boost US domestic production and create more American jobs.
He claimed this policy would also fund his proposed tax cuts and pay down the growing national debt.
Trump and his team announced a two-tier tariff structure.
The first tier is a baseline 10% applied to imports from all countries – with the exception of Canada and Mexico who already had their own separate tariffs.
The second tier was a country-specific tariff where Trump believed the US had been victims of unfair trading practices.
Countries like Cambodia and Vietnam faced combined tariffs of more than 40%, while the EU faced 20% tariffs.
So far, the UK has only had the baseline tariff of 10% applied.
This kickstarted the trade war as countries looked to retaliate.
The EU called for emergency meetings to discuss their next steps, while countries like Japan and South Korea looked to negotiate with Trump as early as possible.
China, on the other hand, wasted no time in retaliating with a 34% tariff on all imports from the US. This led to back-and-forth retaliation from both parties, resulting in a 145% tariff on Chinese goods entering the US and a 125% tariff on US goods entering China, at the time of writing.
One week later, Trump announced a partial reversal of his Liberation Day tariffs with a 90-day pause on all additional tariffs to all countries willing to negotiate with him, except for China.
The 10% tier-one tariff remains in force for all countries – this will give opportunities for countries to negotiate better deals.
This article isn’t personal advice. If you're not sure if an investment is right for you, ask for financial advice. Remember, investments can rise and fall in value, so you could get back less than you invest. Past performance also isn’t a guide to the future.
How did the stock market react?
Volatility has been the theme since Donald Trump returned to office. Markets started the year off strong, but the trade war caused by Trump’s Liberation Day tariffs derailed any progress.
Stock markets fell sharply on the announcements of the tariffs, not just in the US but all over the world, including European and Asian markets.
This trend continued for the week as investors weighed up the potential impact.
And now recession fears are creeping in, with some experts increasing the chances of a recession in the US to 60%.
Now that Trump has paused the additional tariffs, we’ve seen an immediate rebound.
Going forward, we expect the markets to remain volatile to any new news that comes out of the Trump camp.
Why did Trump back down?
There’s no telling exactly why Trump paused implementation of the additional tariffs, but he certainly tested the resolve of the American people.
It’s estimated that 60% of the US population is invested in the stock market, and not many would’ve expected this level of volatility in such a short time.
Inflation expectations could’ve played a role.
With higher costs to import goods from abroad, American companies might decide to pass the extra cost onto the consumer. This rise in prices could lead to higher inflation.
The Federal Reserve has stated that the trade war could cause inflation to jump to 4% this year, after it fell to 2.4% in March.
US growth has also been revised down. Economists are expecting the US to grow just 0.8%, down from their predicted 1.7% just last month. This again will be a cause for concern for Trump.
How have global stock markets performed?
Global stock markets gained ground in the 12 months to the 15 April 2025.
Over the past year, the broader global stock market has risen 1.57%*.
The Chinese stock market was the best-performing market over this period, returning 22.81%.
China has been battling an on-going property crises and low consumer spending, resulting in a push from the Chinese government to improve conditions – the stock market benefited from these stimulus packages.
The Chinese technology sector has led the way over the last 12 months. They’ve benefited from the progress made in artificial intelligence (AI) space where they’ve been able to rival US AI companies like ChatGPT for seemingly less money.
President Xi has also changed his stance with technology companies to a more favourable one with less regulation.
The Mexican and the Korean stock markets were some of the worst performing, returning -21.11% and -19.41%.
Mexican stocks fell when current president Sheinbaum was re-elected. That’s because markets are concerned she could issue more radical reforms.
Korean stocks have been trading at a discount compared to their global peers as investors are concerned with the governance of many businesses in the region.
Lots of large businesses in Korea are conglomerates and family-owned, meaning investors can have little impact on company’s decisions.
Also, with the political situation still uncertain following the arrest of impeached former president Yoon Suk, Yeol investors remain cautious on the region. Elections to replace Yoon will happen on 3 June.
From a sector level, the financial service sector performed the best, returning 15.21%. Energy stocks lagged the wider market, returning -16.99%.
How have our Wealth Shortlist funds performed?
Global funds on the Wealth Shortlist delivered mixed performance over the past year, with some faring better than others.
A year is a short time to assess the skills of a fund manager though. Managers with different strengths, styles and areas of focus will perform differently over time.
Investing in funds isn't right for everyone. Investors should only invest if the fund's objectives are aligned with their own, and there's a specific need for the type of investment being made. Investors should understand the specific risks of a fund before they invest, and make sure any new investment forms part of a long-term diversified portfolio.
For more details on each fund and its risks, please see the links to their factsheets and key investor information below.
Artemis Global Income has been the best-performing fund in the global sector of the Wealth Shortlist over the past 12 months to 15 April 2025.
Managed by experienced investor Jacob de Tusch-Lec, the fund returned 14.10%* versus 1.57% for the MSCI All Country World Index and 2.64% for the IA Global Equity Income peer group.
We like de Tusch-Lec’s contrarian approach to investing, but it can mean the fund invests very differently to its peers.
Our analysis suggests de Tusch-Lec’s stock selection has been the main driver of returns over the past 12 months.
In particular, selections in the UK and Europe, as well as investments in financial service companies, have all boosted the fund’s performance.
The fund can invest in smaller companies as well as emerging markets which can increase risk. The manager can use derivatives too which, if used, increases risk. Charges are also taken from capital.
The abrdn Global Smaller companies fund was the weakest performing fund in the global sector of the Wealth Shortlist, returning -3.18% over the past 12 months to the 15 April. However, the fund did outperform the MSCI All Country World Small Cap Index which returned -4.88%.
As at 31 March, the fund invests in 48 companies. This means each holding can make a meaningful contribution to performance, but it can increase risk.
The managers also invest in higher-risk emerging markets and can use derivatives, which if used adds risk.
Over the last 12 months, smaller companies have had a much tougher time compared to larger companies. The market throughout 2024 was generally led by large US technology companies that this fund didn’t own.
The fund has also struggled more recently as its growth style of investing has had a tough time in 2025 from the recent market sell-off.
Both small and large growth companies have performed poorly as Trump’s threat of tariffs have concerned investors that inflation will reignite, and global economies might begin to slow.
Annual performance growth
15/04/2020 to 15/04/2021 | 15/04/2021 to 15/04/2022 | 15/04/2022 to 15/04/2023 | 15/04/2023 to 15/04/2024 | 15/04/2024 to 15/04/2025 | |
|---|---|---|---|---|---|
abrdn Global Smaller Companies Fund | 58.44% | -13.55% | -4.20% | 4.79% | -3.18% |
Artemis Global Income | 45.82% | 9.04% | -1.28% | 27.79% | 14.10% |
IA Global Equity Income | 31.41% | 7.37% | 5.21% | 9.67% | 2.64% |
MSCI AC World | 38.86% | 5.99% | 1.76% | 18.25% | 1.57% |
MSCI ACWI Small Cap | 64.33% | -0.09% | -1.85% | 11.21% | -4.88% |