Market Reactions to Trump's Tariffs: Tech Stocks to Watch

Investors are cautious as tariffs loom, yet opportunities arise in tech stocks. The uncertainty surrounding the trade war provides a strategic buying chance, particularly in leading tech firms like TSMC and Amazon that are poised for growth in AI and cloud services.

Date: 23-04-2025

AI Rating: 7

**Market Landscape: Tariffs and Investment Opportunities**
President Donald Trump's tariffs are creating volatility in the stock market, particularly affecting sentiment around technology stocks. Despite this, the analysis encourages investors to view the current landscape as a buying opportunity for long-term gain, especially in tech companies that are well-positioned for growth.

**Earnings and Revenue Insights**
The report highlights significant potential for two key players: Taiwan Semiconductor Manufacturing Company (TSMC) and Amazon. TSMC, as a dominant semiconductor manufacturer, has reported growth in revenue largely driven by high performance computing (HPC), which currently constitutes 59% of its revenue. The company anticipates over 20% year-over-year revenue growth heading into 2025, supported by increased demand in AI and cloud computing sectors. This projected revenue growth is certainly a factor that could influence TSMC’s stock price positively.

For Amazon, the narrative is slightly different. The e-commerce giant is experiencing pressures from tariffs that could impact its sellers who rely on Chinese manufacturing. However, its diversified business model allows it to generate significant revenue through services like AWS, which currently sees a year-over-year revenue growth of 19% and accounts for an operating income nearing $40 billion. Given that Amazon is also trading at a low forward P/E ratio of 27.4, the market may be undervaluing its potential in the long term, particularly as profit margins in AWS could expand as the company scales.

In summary, while tariffs create headwinds for these companies, their underlying financial growth and positioning in robust sectors like AI and cloud computing suggest that they remain solid investment choices in a tumultuous market.

Stocks: TSM AMZN