Throughout his campaign, President-elect Donald Trump has proposed a 60% tariff on Chinese goods if elected. However, many investors are concerned this could have an inflationary impact and negatively affect stock markets (^DJI, ^IXIC, ^GSPC).

Morning Brief welcomes Truist co-chief investment officer and chief market strategist Keith Lerner to discuss the potential market implications of this scenario.

"You think about a tariff, it's a sales tax," Lerner notes, explaining that companies with global production exposure, as well as sectors like consumer discretionary, manufacturing, and steel, could face headwinds. However, he also believes "companies will adjust" to the new environment.

While Lerner anticipates these potential policies would "inject some volatility" in 2025, he sees opportunities for areas like small caps to outperform. "I think there's more upside since [small caps are] relatively cheap," he says.

To watch more expert insights and analysis on the latest market action, check out more Morning Brief here.

This post was written by Angel Smith