One Year Since Trump’s Victory: What Has Changed (and What Hasn’t) in the Markets
6 NOV, 2025
Pierre-Alexis Dumont, Chief Investment Officer at Sycomore AM (part of Generali Investments)
Artificial intelligence continues to drive stock market growth, but Trump’s agenda has also favored European exporters and increased market dispersion.
The government shutdown and the lack of economic data pose risks to consumption and heighten monetary uncertainty.
We have reduced positions in U.S. technology, increased in Asia, and maintained diversification with emerging market debt and sectors such as gold and defense.
A year has passed since Donald Trump’s election and the implementation of his disruptive agenda, and it is time to analyze the implications and draw the first lessons for capital markets.
Some aspects have not changed: stock market leadership remains highly concentrated. The theme of artificial intelligence dominates most investments and drives the market.
The absence of investment in AI implies no economic growth in the United States, and the lack of growth in AI-related companies means no earnings growth for the S&P 500.
However, over the past year, both the U.S. dollar and Treasury bonds have seen their status as reserve currency and safe haven, respectively, called into question. As a result, investors have sought diversification and alternative safe investments.
Trump’s disruptive program has also created a new market leadership, especially among European exporting companies. We will have to get used to an environment of lower visibility, greater dispersion, and different stock market leadership.
Other factors that began before Trump’s election have intensified since then. Among them are the rise of passive strategies, which now account for the majority of investments in the U.S., and the boom in retail investors (around 10% of flows before 2020, now 25%). Traditional institutional investors have become a minority.
The “old” investment approach in capital markets—based on regional, style, and sector exposures—has shifted toward theme-based investing. This explains why bitcoin markets, gold-exposed stocks, nuclear energy, or European defense have returned over 100% so far this year, even though they are not among the best-performing sectors.
This requires greater responsiveness, flexibility, and optionality in our investment decisions. While global risk is higher, it will be largely offset by broader diversification.
