Trump Zelensky Meeting: How Should Investors Prepare?

How the Trump-Zelensky Meeting Could Impact Markets: What Investors Need to Watch

The upcoming weekend meeting between Donald Trump and Volodymyr Zelensky is not just a diplomatic event—it carries major implications for capital markets, particularly in defense stocks, energy, commodities, and global risk sentiment. With Trump pushing for a quick resolution to the war in Ukraine and potential shifts in U.S. foreign policy, investors are closely watching the potential market impact.

With geopolitical uncertainty rising, here’s what traders and investors should focus on—and how different outcomes could affect stocks, commodities, bonds, and risk sentiment.

1. Trump’s Push for a Quick Peace Deal: What It Means for Markets

Trump has repeatedly claimed he could end the war in Ukraine “within 24 hours”, but his approach raises serious concerns for investors, NATO allies, and European markets. The main risk is that Ukraine could be pressured into an unfavorable settlement, legitimizing Russia’s territorial gains and disrupting global markets.

Market Risks from a Rushed Peace Deal:

• A softened stance on Russia could destabilize Europe’s security framework, affecting European equities, the euro (EUR), and risk sentiment.
• If Trump signals a reduction in U.S. military aid, it could weaken defense stocks that have benefited from ongoing support for Ukraine.
• If Ukraine is forced into a ceasefire without strong security guarantees, it could increase longer-term uncertainty, keeping gold (XAU/USD) and bonds (U.S. Treasuries) in demand.

🔹 Investor takeaway: A hasty ceasefire deal could create market volatility, particularly for European equities, defense stocks, and safe-haven assets like gold and bonds.

2. Defense Sector: Will the Rally Continue or Stall?

U.S. defense contractors—including Lockheed Martin (LMT), Northrop Grumman (NOC), Raytheon (RTX), and General Dynamics (GD)—have benefited significantly from U.S. military aid to Ukraine.

Key Considerations for Defense Investors:

• If Trump signals a cut in military aid, it could halt the momentum in defense stocks.
• If aid continues, particularly in a different form (such as NATO-led support), defense contractors could still see strong demand.
• European nations, including France and the U.K., are preparing to increase their own military spending, which could partially offset any reduction in U.S. support.

🔹 Investor takeaway: Watch Trump’s statements closely. A commitment to military spending could support defense stocks, while a shift toward diplomacy over arms aid could lead to a sector pullback.

3. Commodities & Energy: Will Ukraine’s Natural Resources Become a Geopolitical Asset?

One of the biggest surprises leading into this meeting is Trump’s push for a rare earth minerals deal with Ukraine. These critical materials are essential for industries like EV batteries, semiconductors, and defense technology.

Potential Market Impacts:

• If Ukraine agrees to U.S. investment in rare earth mining, it could benefit U.S. rare earth companies like MP Materials (MP) and Lynas (LYSCF).
• If Ukraine rejects the deal or negotiates harder terms, China could maintain dominance in the global rare earth supply chain.
• If Trump relaxes energy sanctions on Russia, it could increase global oil supply, pressuring Brent and WTI crude oil prices and energy stocks.

🔹 Investor takeaway: Watch rare earth and energy stocks. A deal with Ukraine could boost U.S. mining companies, while a softened stance on Russia could weigh on oil prices.

4. Bonds & Safe Havens: Will Investors Hedge Against Geopolitical Risk?

Global markets are sensitive to uncertainty, and this meeting could introduce a fresh round of volatility.

Potential Reactions in Bonds & Safe Havens:

• If the meeting ends without clear agreements, expect investors to buy U.S. Treasuries (TLT) and gold (GLD, XAU/USD) as a hedge.
• If Trump signals isolationist policies, expect a weaker U.S. dollar (USD) and higher bond prices as capital flows into safe havens.
• If markets view the meeting as stabilizing, expect a reversal of risk-off positioning, with money flowing back into equities.

🔹 Investor takeaway: Keep an eye on bond yields—a spike in demand for Treasuries or gold could signal rising market fears.

5. Broader Market Sentiment: Risk-On or Risk-Off?

Key Market Themes to Watch:

• If Trump backs a diplomatic resolution while maintaining aid, expect moderate market optimism and stability in equities.
• If Trump suggests a major reduction in U.S. involvement, expect volatility in defense, energy, and European markets.
• If the meeting ends in ambiguity, short-term market sentiment could shift toward risk-off positioning, increasing demand for gold, bonds, and defensive stocks.

🔹 Investor takeaway: Expect volatility. Markets will digest Trump’s comments in real-time, influencing investor sentiment across multiple asset classes.

Trump Zelensky Meeting: How Should Investors Prepare?

Keep in mind:

✅ Defense stocks: Bullish if military aid continues, bearish if Trump signals a major policy shift.
✅ Rare earths & energy: Watch for any deal announcements with Ukraine—this could move mining and energy stocks.
✅ Bonds & gold: Hawkish foreign policy = risk-on sentiment, uncertainty = demand for safe-haven assets.
✅ European equities: A soft stance on Russia could create regional market instability.

As traders and investors assess this critical meeting, staying nimble is essential. If Trump signals de-escalation, risk assets could rally—but if uncertainty rises, expect a defensive shift in portfolios.

🔹 Bottom line: Markets are watching closely. This meeting could shape global markets, trade flows, and investment risks—investors should be ready to position accordingly.

This article was written by Itai Levitan at www.forexlive.com.