Investors now have a flavour of how unpredictable life could be under a Trump administration as tariffs on neighbours Mexico and Canada were announced and then subsequently delayed in the space of 24 hours. Quite what this means for global markets is still up for debate and there remains an air of real uncertainty over what comes next.

In this week’s news section, Martin Gamble picks over what we can judge from what we know so far. However, what we can say with some degree of certainty is an America with a genuinely protectionist agenda could have all sorts of implications for the dollar, interest rates, inflation and more so expect us to continue analysing and assessing this story as it develops.

One initial observation from the recent volatility which has afflicted stocks, is the UK market might not be the worst placed in the current circumstances. It has limited technology exposure – which means the DeepSeek drama is not that relevant. The FTSE 100, in particular, has decent exposure to the dollar so a stronger US currency could flatter earnings in relative terms.

Valuations are nowhere near as high in the UK as they are for American shares and there aren’t lots of listed manufacturing firms in the UK which would be vulnerable to Trump’s apparent trade war. Notably the FTSE 100 is up twice as much as the Nasdaq composite index so far in 2025, an unusual state of affairs.

Berenberg analyst Jonathan Stubbs, writing in mid-January, said: ‘In 2024, UK equities returned around 10%, with leadership from banks. Momentum strategies, including buyback momentum, performed well; value did too. Despite positive gains, UK equities continue to trade at a deep discount to both global equities and their own history at around 10.7 times. To us, this suggests that the hurdle to reasonable returns from UK shares this year is low.’

Cheap small-caps are part of the UK equity story and we have parts two and three of our four-part series on small caps in this issue, crunching some data and looking at the top-performing UK small cap funds and trusts. In the next issue we’ll look at small-cap collectives with a more global horizon.

And, after our trip to SRT Marine Systems’ (SRT:AIM) AGM covered in our last issue, this time round we pitched up to Finsbury Growth & Income’s (FGT) latest annual get together, with manager Nick Train in mea culpa mode once again.

Investors can derive a big benefit from being properly engaged with the stocks and trusts they are invested in, and it’s been really encouraging to see the high levels of retail participation in the meetings requisitioned by US activist hedge fund Saba at several investment trusts recently. We cover the latest on this story elsewhere in the digital magazine.

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