On November 6, analysts at Fidelity International released a report stating that tariff discussions may dominate the second half of 2025, with companies divided into two camps: those "preparing for the worst" and those "waiting for opportunities." Firms with pricing power are better positioned to manage cost pressures arising from tariffs, particularly in sectors like information technology, consumer staples, healthcare, and industrials. However, weak demand in certain sub-sectors, such as luxury goods, may limit their pricing flexibility.

Compared to companies in Asia-Pacific and China, businesses in developed markets could face greater challenges from trade tensions. The report indicates that policy changes have had a more positive or neutral impact on regions like Asia-Pacific and China. Fidelity International highlights regional differences in expected cost increases, aligning with its broader medium-term outlook. Falling oil prices are one factor mitigating cost pressures.

James Trafford, an equity analyst covering related industries, noted: "OPEC+ has resumed supply faster than previously anticipated. While oil prices remain unexpectedly resilient, they may decline in the second half of the year once production ramps up." However, additional tariffs could trigger a one-time cost-driven inflation spike, with consumer discretionary firms particularly vulnerable.

Zak Gibson, an analyst covering the consumer discretionary sector, agreed, stating: "90% of apparel products are imported from China." Thomas Goldthorpe, a financial sector analyst, added: "Banks consume minimal imported goods," though he cautioned that tariffs' ripple effects could dampen loan growth if the economy weakens.

For companies significantly affected by tariffs, pricing power is critical to maintaining margins. Industry dynamics vary widely. Information technology, consumer staples, healthcare, and industrials are sectors where analysts most frequently observe moderate or strong pricing power.

Andrew Hall, an analyst covering North American consumer staples, said: "During the 2022–2023 inflation cycle, retailers successfully passed on food inflation costs. Tariff-induced inflation may be more moderate." Oliver Trimingham, who researches European aerospace, added: "Engine manufacturers enjoy the strongest pricing power in industrials due to monopolistic or duopolistic positions, high barriers to entry, and strong customer loyalty."

Jonathan Tseng, a semiconductor analyst, noted similar dynamics: "This is a consolidated industry with significant production complexities, granting manufacturers strong pricing leverage." Dominic Hayes, an industrials analyst covering capital goods, remarked: "Most firms I cover are high-quality businesses with pricing power and similar supply chain structures. The key question is the extent of demand erosion."

Some sub-sectors face demand weakness that constrains pricing power. Emma Cunningham, an equity analyst, explained: "Historically, luxury companies had strong pricing power, but post-pandemic overpricing has made further hikes difficult. Volatile demand has broadly weakened consumer sectors, including luxury."

Currently, most analysts report that existing trade policies negatively impact their coverage. Companies may relocate production to mitigate tariff costs, but this isn’t always feasible—especially when many firms pursue similar strategies. While global supply chain restructuring could reduce individual firms' tariff burdens, it may also introduce additional inflationary pressures post-initial tariff shocks.

Penn Bowers, an analyst covering Japanese gaming companies, noted: "The firms I cover can adapt their supply chains, so short-term tariff impacts may give way to long-term adjustments." Andras Karman, a fixed-income analyst covering autos, warned: "Rushed reshoring to the U.S. could exacerbate labor shortages and wage inflation."

Analysts focused on Asia remain relatively optimistic. Most covering Asia-Pacific, China, and EMEA/Latin America report neutral or positive effects from current trade policies, suggesting developed-market firms may bear the brunt if tensions persist.

Evan Delaney, a fixed-income analyst covering North American telecoms, observed: "Tariffs may raise smartphone prices (e.g., iPhones), reducing upgrade demand and slowing subscriber growth." Sukhy Kaur, a financials analyst, added: "Tariffs reduce Fed rate-cut odds, supporting banks' net interest margins. Higher inflation also generally benefits insurance brokers."