Tariff War Can Slash S&P 500 Firms’ Operating Income by 32%, Bank of America Says
Stock market tumbled on Thursday after President Donald Trump imposed steep American tariffs, fueling fears of a global economic slowdown.
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About a third of the operating income of companies in the S&P 500 Index could be at risk if US trading partners respond with equal tariffs, an estimate compiled by Bank of America Corp. shows.
The bank’s strategists, including Savita Subramanian, BofA’s head of US equity and quantitative strategy, focus narrowly on the cost increase from incremental tariffs and the foreign sales impact from retaliatory measures. They note that apart from that, “prolonged negotiations could stall activity spiraling into a recession.”