🍔Market Shock: Stock Meltdown, Trump Tariffs, and Recession Signals

What is the next phase of the trade war?

This week marked the worst week for stocks since the March 2020 Covid collapse. Nasdaq and Russell 2000 entered bear markets (down >20% from highs) with the S&P500 close behind (down 18%). Dow fell a record 2200 points on Friday. Mag 7 stocks lost a whopping $1.4T in market cap; the most ever, period.

Investors (including ourselves) had been waiting for April 2 Liberation Day and holding out hope that the tariffs would not be as bad as feared. We were wrong; they’re here, and they’re bad. As various countries and trading blocs moved to retaliate, markets spent Thursday and Friday pricing in the possibility of further escalations and a deep recession.

Corporate margins and earnings are expected to take a big hit as the cost of imports rises drastically. Companies that make high-margin consumer goods for cheaply overseas, such as Nike, Lululemon, and Restoration Hardware, led the way down.

In volatile times like these, you need to protect your portfolio. Understanding the current economic and political regime has helped us stay one step ahead of the market. Join us as we time the market!