Trump’s tariff reversal threatens to extend the M&A downturn as Wall Street grapples with hiring freezes, bonus blues.
On Wednesday, President Donald Trump announced a 90-day pause on most tariffs, with the exception of China, which is now facing tariffs of up to 125%. While the reversal lifted stocks, resulting in the biggest single-day gain for the S&P 500 since 2008, it isn’t expected to do much for M&A, which was already on the fritz leading up to Wednesday’s announcement. In fact, some are predicting Trump’s pause could make things worse.
“We’re going to have three more months of paralysis,” said Alan Johnson, a finance industry compensation consultant. “Buyers and sellers are going to say, ‘I’m going to wait,'” added the Johnson Associates founder.
It’s not just investment bankers who are sitting on the sidelines. Private equity deal pipelines are also on hold as investors and target companies try to understand how current and future tariffs could affect business revenues and supply chains.
Trump’s tariff pause threatens to further dampen bonuses by pushing the timeline out even more — potentially to 2026, said Johnson, the compensation consultant.
“Would you do a deal now if you’re a buyer? In 90 days, maybe he changes his mind again, or 90 days becomes 30 days, or 90 days is tomorrow, or 90 days is 180 days,” Johnson said, referring to President Trump. “Maybe things will be a lot better in three months, the sun will start shining. But now we’re in what, July? And then by the time the lawyers get involved and you sign an agreement, it’s 2026.”
Source: Africabusinessinsider
