How Do White House Strategies Affect Wall Street?

A Dark Period for Investors

With the start of February, investors entered a period filled with uncertainty due to the harsh foreign policy moves made by U.S. President Donald Trump in January. These developments indicate that significant political risks will dominate the markets throughout 2026. According to reports from MarketWatch, geopolitical risks have become more impactful than economic data and corporate earnings at the beginning of this year, causing fluctuations on Wall Street.

Fluctuations in Currency and Commodity Markets

In this uncertain environment, the U.S. Dollar fell to its lowest level in four years, while gold prices surpassed $5,000, and oil prices reached a six-month high. Although stocks managed to close positively, investors are facing a level of uncertainty not seen for a long time. One of the main sources of this process is Trump's plan for a military operation aimed at ousting Venezuela's leader Maduro by 2026.

Tensions with U.S. Allies

This military strategy, combined with threats of tariffs on Europe and rising tensions with Iran, has created profound effects on global markets. Furthermore, Trump's nomination of Kevin Warsh for the Fed chairmanship has not been enough to stop the erosion of market confidence. Analysts emphasize that the stock markets are struggling to price the geopolitical risks.

Market Uncertainty and Economic Data

Normally, strong corporate earnings would serve as a buffer for the markets, but this time, the impact of political developments is outweighing it. Although the profits of S&P 500 companies in the fourth quarter were above expectations, they remain below historical averages. Notably, the decline in Microsoft shares and the slowdown in cloud computing are negatively affecting the technology sector.

All eyes are now on the reports from artificial intelligence-focused companies like Alphabet, Amazon, and Palantir, which will announce their earnings this week. Despite strong economic data, investors are navigating this challenging period where political headlines dictate the market's direction.