Tariffs spark major market sell-off, echoing 1987, 2008 and 2020 crashes. Uncertainty remains, but portfolio strategies focus on risk and opportunity.
It was a red letter month for financial markets with the ‘Liberation Day’ reciprocal tariffs having the potential to upend 80 years of global economic prosperity and development. The move by the Trump administration is the biggest supply shock to the global economy since the oil crisis of the early 1970s, with further economic and market pain likely. In the United States, the magnitude of (short term) selling across the month in the Standard & Poor’s 500 Index has only been experienced on three other occasions: 1987 stock market crash, 2008 Global Financial Crisis and 2020 Coronavirus disease. With tariff uncertainty remaining high, we expect that the downside risk to markets is set to remain for the foreseeable future. However, despite the challenges, from a portfolio perspective we continue to focus on using the breadth of investment tools we have across all asset classes as we look to manage overall risk while focusing on opportunities as they present.
