Investing.com – Potential Surprises for 2025 by Wolfe Research

Wolfe Research recently outlined five potential surprises for 2025, including a possible Fed pivot that could shake up markets.

1. Port Workers Strike

A possible strike by port workers on January 15, resulting from unresolved automation issues in port operations, could disrupt supply chains and impact GDP by approximately $3.1 billion per day.

2. Downward Revisions to Payrolls

Upcoming benchmark revisions may reveal a downward adjustment of around 68,000 jobs per month, signaling slowing job growth that could lead the Fed to a dovish pivot.

3. Shake Up at the Fed

The potential resignation of Vice Chair for Supervision Michael Barr could result in significant leadership changes, with Governor Michelle Bowman likely to succeed him and Kevin Warsh possibly becoming a new governor.

4. Unlikelihood of a Broader Market Rally

Despite investor hopes for a broader stock market rally, Wolfe Research indicates that concentration within the index may continue, reflecting a trend where the S&P 500 has outperformed the equal-weight index in seven of the last ten years.

5. Potential Shift in Trump’s Tariff Policy

President-elect Trump may choose to pursue less harsh tariffs than previously expected, defying investor anticipations of increased tariffs on Chinese goods and others after initial market reactions to tariff headlines.