Shocked investors are searching for a light at the end of the tunnel after being hit by Trump tariffs.
Indeed a glimmer of any kind is hard to find at the moment.
Markets have shed an astounding $5.4 trillion in value in the two days since President Trump revealed big-time tariffs on major countries last Wednesday. The S&P 500 (^GSPC) is now at its lowest level in 11 months, with pros saying the carnage may not yet be over.
Futures on the S&P 500 (ES=F), Nadaq 100 (NQ=F), and Dow Jones Industrial Average (YM=F) are down 2.8%, 3%, and 2.5%, respectively.
Wall Street has been slashing its S&P 500 price targets for 2025, dialing up recession odds, and pontificating worst-case scenarios for the bottom lines of household name companies, from Apple (AAPL) to Amazon (AMZN) to Walmart (WMT).
“What I’ve been saying in my meetings lately, even before the Rose Garden [ceremony last week on tariffs], is that it’s not clear to me where [for sectors and industries] new value has been unlocked,” RBC Capital Markets strategist Lori Calvasina told Yahoo Finance. “If you are looking at individual stocks that have any of these [tariff] issues, I suspect it’s very hard to make assumptions about earnings that you can have confidence in.”
Read more: The latest news and updates on Trump’s tariffs
So with this as a backdrop, I put a straightforward question to the Yahoo Finance retail investor community in my Sunday Morning Brief newsletter: What stocks are you buying amid one of the biggest routs in recent memory, if any?
“You’re right, it’s messy right now and difficult to decide what to do,” one investor remarked.
Below are several of the best responses I received.
I would still love to hear from you as you navigate the markers this week. Drop me a line @BrianSozzi on X or directly via email brian.sozzi@yahoofinance.com.
“So what am I buying what am I selling? Buying, not much. Like you I find it is impossible to get my bearings on individual shares since tech began to waver last August.
“You’re right it’s messy right now and difficult to decide what to do. I have taken lumps and sold positions that I was keeping to see if they went up over time, but time ran out Thursday … they went down too much, so my marginal investments went kaput and I sold for losses ranging from 8% to 25%. Gulp.
“I have retained my IT investments which earlier this year I had moved to ETFs due to individual position volatility, but I’am facing a huge loss with Dell, (DELL) my chosen darling and only remaining tech stock, in what now looks like a horrid decison. It is a loss that I have yet to materialize but it rankles me. I may average down.
“I sold most everything where I was losing big or medium. I bought no new positions but added to two dividend payment positions as defensive measures Mercedes Benz Group (MBG.DE) and Banco BPM (BAMI.MI)
“I have kept all my (5) European defense stocks, Hensoldt (HAG.DE), Leonardo (LDO.MI), Rheinmetall (RHM.DE), losing Renk (RENK.VI) and Indra (ISMAY) due to stop losses that in the midst of battle, I inadvertently forgot to remove. (they all had big profit cushions, not crying about those sales). I kept 2 of my 3 my ETF’s related to defense … selling a US dollar denominated ETF only.
“My utility investments have done well in this sinkhole market.
“I am steeling myself for additional loss-making sales next week, as, despite a potential bounce back, I don’t expect this to be a two day calamity.
“I have kept most banks due to dividends, takeover situations and large profit cushion. I added to a German mid cap ETF as I expect there will be orders going their way. I am also keeping Mercedes Benz and Porsche (PAH3.DE) auto shares because of their potential to segue into defense related production to save themselves.
“I have also retained two engineering construction companies that are involved in oil exploration or refinery building or similar un-ecological energy activities, despite also having some green energy projects.
“I’m a 61-year-old barely-retired self-managed investor living in Michigan, heart of the US auto industry. Under Trump 1.0 I underperformed broad market indices. The president’s continuous tweets and flip-flops made rational investing challenging. I sold into negative comments, missed out on snapback rallies, and watched long-term passive investors who paid no attention to daily gyrations make sizable gains.
“This time I would learn from prior mistakes — so I thought.
“I checked charts to recall China trade war rhetoric and saw a two-week 8% drawdown in March 2018 precede a strong rally. As the Rose Garden tariff chart flashed across the internet on Wednesday, I saw my opportunity. Not knowing what to purchase with my cash hoard I went broad with QQQ (QQQ) and SPY (SPY), picking them up “on the cheap” thinking this would be capitulation of the March correction similar to 2018. I finished the day down 2%. The next day down another 5%.
“Now, with sentiment reaching extreme lows, I wait. I bite my nails for fear of further drops yet can’t chance being out of the market should a positive announcement occur (tariff “deal”, end of military conflict, or some out of the blue statement from the president).
“I ask, how a nation can offer “concessions” when its only transgression is supplying the US appetite for goods. How does a company restructure, overnight, global supply chains and manufacturing that took decades to establish? How should an investor respond when this entire “tariff” correction is resultant of one man’s simplistic US trade deficit calculations? What if this all vanishes with a single post on social media?”
Read more: How to protect your money during economic turmoil, stock market volatility
“Brian, I lived through the financial crisis as well, and in my view, this situation is very different. Unlike back then, this crisis could potentially be resolved with the stroke of a pen. While I understand that some damage has already been done, the sell-off so far feels largely indiscriminate.
“Right now, I’m investing in management teams rather than just companies. No one can say for sure when or how this ends, but I believe that backing leaders who have successfully navigated multiple crises will pay off in the long run.”
“Just read this. Although I agree with the premise, I don’t think it is as doom and gloom as the article paints. Example would be if as an analyst if your clients bought Apple back then, where would they be now or 10 years ago? As to what stocks I’m buying: tech, healthcare.”
Brian Sozzi is Yahoo Finance’s Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
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