President Trump unleashed a sweeping new list of tariffs yesterday, raising levies on Canada to 35% and setting the baseline rate for most nations to 10%.

• Today: We unpack the winners and losers of the trade war.
• Plus: The one job that Robinhood's CEO says is safe from AI.

It wouldn't be the Markets newsletter if I didn't have to rewrite it because of more breaking news on tariffs! Let's get into it. All in 1,280 words in 5 minutes.

Tariff deadline day is here. The administration last night published a list of about 70 countries and their respective tariff rates, set to go into effect next Thursday.

Why it matters: As stocks continue hitting record highs, beneath the surface, tariff policy is reshaping market winners and losers. Investors looking to beat the index are racing to determine where the pain and opportunity will hit.

What they're saying: "I think there's a disconnect between the superlative performance of the US equity market and the mediocrity of the American economy," says David Kelly, chief global strategist at JPMorgan, who thinks tariff-driven inflation has yet to fully hit consumers.

• He argues investors should go sector by sector and company by company to determine which firms are vulnerable to margin squeezes versus those that could thrive under the new trade regime.

Zoom in: Based on several Axios Markets interviews, here are the winners and losers of the trade war.

• Winners: Financials, Big Tech, utilities, communications.
• Losers: Consumer staples, energy, real estate, health care.
• Mixed: Consumer discretionary, industrials, materials.

Between the lines: The winners are driven by the outperformance of AI and wealthier consumers holding up spending. Underperformers could be revealed by weakness among lower-income consumers and sector-specific tariff effects.

Case in point: Consumer discretionary is split. Luxury brands and travel companies are holding up, while discount retailers could struggle to pass higher costs on to stretched customers.

• As Big Tech firms feel pressure to have an AI strategy and are expanding their capital expenditures to that end, their rally could still have legs.

Zoom out: Investors would be smart to zoom out and look at "valuations of the different asset classes and different broad sectors in their portfolio and just ask themselves, does this make sense," Kelly says.

• At some point, you will see a "significant correction," he adds, likely to come from sectors with overextended valuations, which in this case is Big Tech.

Be smart: Investors would also be smart to look at the administration's U-turn on copper tariffs as a market case study.

• Copper investors priced in worse levies than what they ended up getting. The market "mispriced tariffs on raw copper," says Rob Haworth, senior investment strategy director at U.S. Bank Asset Management Group.
• The final tariffs announced were less "onerous" than initially expected, triggering a record plunge in copper prices.
• Going forward, investors hope understanding the administration's end goals with the tariffs will yield more clarity.
• "What are we really trying to secure here?" Haworth asks.

The bottom line: The market may be rallying, but trade policy drives sector-specific price action. That could determine market leadership for the year.

If you want a job safe from AI consider becoming a trader. Robinhood's CEO tells Axios human traders will not be replaced by AI in the foreseeable future.

Why it matters: As some tech executives say AI could unleash a white-collar bloodbath, and AI firms are racing to disrupt financial services, Robinhood's chief executive is doubling down on the enjoyment people get from trading.

What they're saying: "Traders legitimately enjoy trading…I think humans will be calling the shots," Robinhood CEO Vlad Tenev tells Axios.

• His comments follow a record earnings quarter for Robinhood. Its revenue jumped 45% year-over-year and total assets on the trading platform nearly doubled to $279 billion.
• Innovation, from the firm's focus on crypto offerings to AI, is a key part of Robinhood's growth story.

The big picture: AI providers are racing to get into financial services, which is expected to be among the top industries disrupted by AI.

• Anthropic recently launched a partnership with KKR, Bridgewater and several other financial services firms and data providers to provide real-time markets analysis.
• OpenAI provides its own suite of tools for enterprises, including Morgan Stanley.

Be smart: "The best analysts often are the people that use AI the most and so they're kind of getting an edge," says George Sivulka, CEO of Hebbia, an AI platform for finance.

• Sivulka argues that AI could create more analyst jobs because "there's more edge to be found using these tools."

Zoom in: Robinhood already offers its own suite of AI tools to investors.

• Paid subscribers to Robinhood Gold receive access to Cortex, an AI-powered market insights provider that tells you what is driving stock performance.
• Options traders have access to an AI tool that "can help them actually put the contracts together…and simplify the process," Tenev says.

The bottom line: While the human element may remain vital, AI tools, like the ones that Robinhood offers, could define the next generation of investing.

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Microsoft joined the $4 trillion club this week alongside Nvidia. Apple, Amazon, Alphabet and Meta could be next.

Why it matters: With all but one member of the Magnificent 7 racing toward this record-high valuation, investors are growing uneasy about just how far Big Tech can run and at what cost.

Driving the news: Meta and Microsoft reported blowout quarterly earnings results late Wednesday, exceeding Wall Street's best estimates for earnings growth and guidance.

• The subsequent stock rally took Microsoft's market cap above $4 trillion.
• Since the launch of ChatGPT in 2022, Microsoft's stock is up 110%, vastly outpacing the broader market's 56% gain in the same time period.

Be smart: It can be hard to visualize $4 trillion, but let's give it a try.

• If Nvidia and Microsoft were countries, they would have the fourth and fifth largest GDPs in the world, respectively. Nvidia alone is worth the equivalent of 14% of the U.S. GDP.
• If you stacked $4 trillion in $100 bills, you could reach the edge of space and back 10 times.

What they're saying: "These massive results seen by Microsoft and Meta further validate the use cases and unprecedented spending trajectory for the AI Revolution," Dan Ives of Wedbush Securities writes in a note to clients.

• Nvidia and Microsoft are the poster children of the AI revolution, he says, though broadly tech stocks are poised to continue moving higher over the next 12 to 18 months.

Zoom in: With Microsoft trading at 40 times forward earnings, some investors are ringing alarm bells, saying the stock is too expensive based on its earnings trajectory.

• Tech bulls like Ives would argue that if you worry about valuations, you always miss tech revolutions, since historically these stocks tend to get overvalued on a price basis.

Yes, but: Overvalued stocks are often the first to correct in a market downturn, David Kelly of JPMorgan tells Axios.

• "The most lofty tech companies are very exposed to something going wrong here," he says, noting a "significant correction" could be coming given these high valuations.

The bottom line: Valuation concerns are still not stopping investors from pushing other Big Tech names closer to the $4 trillion club.

• Apple is the closest based on price, but its stock is down over 14% year to date. Amazon is behind Apple, though it needs an additional $1.5 trillion added to its market cap to catch up.

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• No clutter, no filler — just clean, smart and effective.

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