Trade Truce Sparks a Bull Run—But Only in These Sectors!

The U.S.-China trade truce announced this month is like a lightning bolt in a stormy market—sudden, electrifying, and full of opportunity. But here's the catch: not all sectors are equally charged. While tariffs remain stubbornly high in some industries, others are primed for a surge in valuations. Let's dissect where the smart money is flowing—and why you can't afford to wait.

The Truce: A 90-Day Window for Bold Investors

The May 12 truce slashes reciprocal tariffs to 10%, but don't mistake this for a lasting peace. Effective tariff rates remain sky-high due to overlapping duties like the 20% fentanyl tax and Section 301 levies. The clock is ticking: if no permanent deal is struck in 90 days, tariffs could spike back to 34%, crushing profits. This creates a now-or-never moment for investors to pounce on undervalued stocks with tariff-sensitive upside.

Sector by Sector: Where to Bet

1. Semiconductors: The New Gold Rush

The truce has slashed tariffs on critical components like SSDs and integrated circuits, but the 50% Section 301 tariff on semiconductors (effective since January 2025) remains a hurdle. However, companies that source materials from exempted regions or have U.S. manufacturing hubs (e.g., Intel, Applied Materials) could see margins rebound sharply.

Action: Buy now if you see a dip below $200—this ETF could soar if the truce leads to a sustained supply chain rebound.

2. Electric Vehicles (EVs): A 100% Opportunity

EVs face a brutal 100% Section 301 tariff—but here's the twist. The truce's 10% reciprocal tariff cap doesn't apply to these levies. Wait—then why invest? Because the components (batteries, solar cells) powering EVs are seeing tariff relief. Companies like Tesla, which rely on exempted battery parts, could see cost savings that finally make EVs profitable.

Action: Tesla's P/E ratio is still half its 2020 peak. With China's EV market still hungry for tech, this is a buy at $180.

3. Solar Energy: A Golden Hour

Solar cells are stuck with a 50% Section 301 tariff, but the truce's reduction on reciprocal duties (from 125% to 10%) cuts the total burden for U.S. solar manufacturers. Companies like First Solar, which use domestically produced panels, could see demand surge as utilities pivot to cheaper, tariff-light imports.

Action: FSLR is trading at $50—its 2023 low. If the truce holds, $70 is achievable by year-end.

4. Critical Minerals: The Next Gold Mine

Lithium, cobalt, and rare earth metals face looming 2026 tariff hikes. But here's the play: invest now in miners like Albemarle or Freeport-McMoRan that can lock in lower-cost Chinese supplies while the truce lasts. These stocks are dirt-cheap now but will explode when supply chains stabilize.

Action: Buy any dip below $60 for Freeport-McMoRan (FCX)—it's a steal.

The Red Flags: Sectors to Avoid

• Steel & Aluminum: 25% Section 232 tariffs remain intact. U.S. Steel (X) is still overvalued.
• Agriculture: China's expired exemptions mean soybeans and corn exports are stuck in a slump.

Final Warning: Act Fast, but Stay Vigilant

This truce is a 90-day sprint to lock in gains. If tariffs revert to 34%, sectors like EVs and semiconductors could crater. Use this window to:
1. Buy dips aggressively in the four sectors above.
2. Avoid long-term bets on steel or agriculture.
3. Monitor the 90-day clock—if no deal by August, sell high, sell fast.

The trade truce isn't a cure-all—it's a fleeting chance to capitalize on a market on edge. The question isn't if you should act, but why you're waiting.

Remember: Bulls make money, bears make money, but pigs get slaughtered. Be bold, but don't overstay your welcome.