Are there any business winners in Trump 2?

“THE GOLDEN age of America begins right now,” intoned Donald Trump at the start of his inaugural address on January 20th. The business world bought the glittering talk, in anticipation of lower taxes, less red tape and buoyant American consumers. Between election day in November and the swearing-in, the Russell 3000 index, which covers most of America’s public companies, rose by 5%. The resulting $2.4trn in new shareholder value was equivalent to the entire Indian stockmarket with two Mexican bourses thrown in. America was first. No one came remotely close.

A month into Mr Trump’s second term America was even firster. By February 19th the Russell 3000 had added another $1.4trn in market capitalisation, reaching a record $63trn. Scott Bessent, a comfortingly buttoned-down hedge-fund billionaire, was in charge of the Treasury. Another financier, Howard Lutnick, was installed as commerce secretary. Elon Musk’s engineering genius would make the gummed-up bureaucracy run as efficiently as his Tesla assembly lines. Could things get any sparklier?

It turns out they couldn’t. In the past six weeks the sheen has come right off the Trump economy. Instead of tax cuts America is getting a hike in the form of sweeping tariffs against all the country’s biggest trading partners, the details of which Mr Trump will unveil on April 2nd. Mr Musk’s efficiency drive is gutting the federal workforce willy-nilly. In February alone more than 62,000 government employees got the sack, according to a monthly tally by Challenger, a recruitment firm. Private-sector employers, among them household names like Meta and John Deere, announced 110,000 cuts, compared with 82,000 the year before. Consumer sentiment is collapsing. Wall Street is on recession watch.

On March 31st Goldman Sachs raised the odds of one from 20% to 35%. JPMorgan Chase now puts those of a global downturn this year at 40%. Both banks’ share prices have slid since that February high, too, by 18% and 13% respectively, as consumers tighten belts and hopes of a dealmaking bonanza fade.

Other businesses are feeling similarly miserable. Two in three members of the Russell 3000 are worth less now than they were before Mr Trump’s re-election. A golden age? For short-sellers, maybe, or for pedlars of gold, the price of which has surged past $3,000 per ounce as investors rush out of equities and into safe assets. What about anyone else?

Picking business winners is foolhardy—and downright foolish given just how unpredictable the second Trump administration was probably always going to be. Schumpeter should know. After the election he confidently predicted that American companies would outdo non-American ones and that, within America Inc, small firms would have a better time than corporate giants.

Investors have instead soured on America, and its corporate tiddlers in particular. The Russell 2000 index of small public companies has lost 10% of its value this year, more than twice as much as the S&P 500 index of the biggest ones. The swooning stocks of small companies, whose fortunes are tied to the domestic economy, are pricing in a “pretty nasty” downturn, says Steven DeSanctis of Jefferies, another bank.

In contrast, share prices have risen in Europe (where policymakers are trying to stoke growth rather than extinguish it), China (which is aflutter thanks to eye-catching domestic advances in artificial intelligence by DeepSeek and Manus) and even Mexico (where the left-wing government seems readier to embrace business in order to offset the economic damage from tariffs). Oops.

At the risk of again looking the fool, your columnist will offer two revised predictions and double down on a third. First, things may be looking up for companies whose prospects seemed ho-hum. A rudimentary analysis of Russell 3000 shares shows that the less a firm rode the Trump bump between election and inauguration, the likelier it was to withstand the subsequent Trump slump.

For example, of the 100 companies which lost the most in value between November 5th and February 19th, 72 were pharma and biotech firms. The 100 biggest gainers counted just eight such firms. Since February 19th, there have been as many big biotech gainers as losers. A couple, like 2seventy Bio, which is developing a therapy for blood cancer, leapt from the bottom 100 to the top.

The last shall be first

There may be reasons for this besides health stocks looking dirt cheap. Mr Trump’s health officials have been less disruptive than pharma feared. And big drugmakers, keen to replenish product pipelines, are in an acquisitive mood. Two in five American mergers and acquisitions this year have involved health-care firms, notes Mr DeSanctis; on March 11th Bristol-Myers Squibb, an industry giant, said it was buying 2seventy Bio for $286m.

The second prediction is safer. Tariffs will not lead to a manufacturing renaissance. But with Mr Trump, then Joe Biden and now Mr Trump again breathing down their necks about reshoring, bosses are likely to bring more business home than they otherwise would. That is good news for companies that help build domestic supply chains (such as Rockwell Automation, which makes industrial robots) or manage them (like Prologis, America’s biggest warehouse operator).

Then there are businesses belonging to Mr Trump and his pals. Your columnist still doubts they will be big winners. Motorists in America and elsewhere are steering clear of Teslas. Some deplore Mr Musk’s behaviour; others prefer better alternatives now on offer. The carmaker’s market value has fallen to three-fifths of its peak in December. That of the president’s own cash-burning social-media company, Trump Media and Technology Group, is down by half since he declared the new golden age. In this sense at least, he is suffering with the American people. ■