As portfolios plunge following President Trump’s latest tariff announcement, Vanguard is urging its clients to hold the line.
The $9 trillion asset manager sent a pointed reminder this week: don’t panic-sell your stocks.
“Stay the course,” the firm wrote in an email to clients. “With the White House announcing new tariffs, the markets have become volatile, testing the resolve of even the most disciplined investor.”
Vanguard’s message was clear: stick to your financial plan. No matter how bad it looks during a sell-off, markets eventually recover, but investors aren’t listening.
Like other asset managers, Vanguard has watched jittery clients ditch their positions in real time.
So far, Trump’s first 100 days in office have wiped nearly $10 trillion off the U.S. stock market, half of that since his April 2 “Liberation Day” tariffs.
And the pain is only accelerating.
On Tuesday, the Nasdaq gave up its biggest intraday gain in more than 40 years — flipping a 4.6% rally into a 2.1% loss by the close.
Major indexes have now logged four straight days of losses, as Vanguard’s warning seemingly fell on deaf ears.
The path ahead won’t be easy
With Trump’s trade war intensifying and the U.S. imposing the highest tariff rates in a century, few believe the market has bottomed.
“This is beyond the swift rebound story,” said Neil Dutta, head of economics at Renaissance Macro. “This is a confidence shock, and it’s going to take time to get that back.”
That confidence is being further rattled by growing fears that Trump’s policies are steering the U.S. toward a recession.
The latest reading from the Atlanta Fed GDP Tracker shows a 2.8% contraction for Q1, which would mark the first quarter of negative growth since 2022.
If that downturn materializes, investors could be staring down another 20% sell-off, according to BlackRock CEO Larry Fink.
And it’s not just Wall Street that would take a blow.
“Sixty-two percent of Americans now invest in stocks,” Fink said. “A move like that would hit Main Street just as hard.”
While a handful of economists polled by CNBC aren’t forecasting an outright recession, their outlook isn’t much brighter. They’re calling for just 0.3% GDP growth in Q1.
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