The New York Stock Exchange. File photo.
Global stock markets have plunged amid President Donald Trump’s tariff plan that has fueled recession and inflation fears as drops have wiped out trillions in market value.
The market downturn, which saw the Dow Jones Industrial Index drop from over 42,000 at the start of the year to just above 38,000 as of Friday, has prompted local financial professionals to urge caution and long-term perspective.
Patrick Clark, founder of Neshaminy Creek Advisors in Bensalem Township, said the tariffs’ “broader and deeper than what was expected” impact has caught the markets off guard.
“I don’t think there was an expectation that it was going to be this deep and this broad,” Clark said.
He advised investors against panic selling and pointed to the market’s historical resilience.
“If we look at every financial crisis we’ve had in recent memory, people say ‘it’s different this time.’ And it’s never different. The only thing that’s different is how long it takes to recover, right? The story might be different, but the results aren’t. The market recovers and it can be used as a buying opportunity.”
He had simple advice: “Don’t panic sell, stick to your strategy, and don’t get out at the wrong time.”
Clark wrote a note to clients on Friday that reminded them of the market’s long-term resilience, citing historical recoveries from significant economic shocks.
“It’s important in times like these to remember that markets can be fragile in the short run but are resilient in the long run,” Clark wrote. “In times of uncertainty, it can feel as if markets will never stabilize. Yet, history shows that markets can overcome even the most significant shocks.”
Clark said he has been proactively managing risk for his clients and holding a mostly cash position since March 10. “
“It’s not timing the market, because we’re not trying to find the exact bottom … I’m following the market and seeing where the money is going. More people putting money into cash means less money is going into the markets or money is coming out,” he said.
On Friday, Clark said that investors who have pulled out should strategize their re-entry before a market rebound.
With the rise of individual investing, Clark warned against treating the market like a “casino.”
“I think this is a wake up call for them,” he said. “It’s very difficult to lose money in an up market, but a lot of people are going to lose money in a down market.”
Bucks County, which has a number of industries and proximity to major markets, has historically weathered economic downturns relatively well. However, small businesses in the area are now facing a widespread uncertainty not felt in years.
“This is going to affect us. However, I think certain sectors it’s not going to affect as much,” Clark said of Bucks County. “All the sectors getting hit in the short term just because people are moving out of things right now. If this goes on longer term, certain sectors, like oil, are going to get hit.”
Clark advised small businesses to maintain marketing budgets and position themselves as customer-focused during any downturn.
A Doylestown-based financial advisor, who wasn’t authorized to speak on the record, echoed Clark’s sentiment. He urged investors to avoid emotional decisions.
“One of the fundamental principles for long-term investors is to remain disciplined and avoid making rash decisions. Market downturns can actually present opportunities to capitalize on lower prices,” he said.
The advisor criticized the broad tariff plan.
“Anyone who claims that this tariff plan is beneficial for investors is blowing smoke,” he said. “The market is filled with uncertainty, and we are receiving very little in the way of certainty from Washington. It’s difficult to know how this is going to play out.”
Trump’s tariffs plan includes a 10 percent baseline levy on all imports for more than 180 countries, including a number of allies. China faces the highest tariffs at 54 percent, and Beijing has hit back with 34 percent tariffs on all goods imported from the U.S.
“There is no postponing. They are definitely going to stay in place for days and weeks,” U.S. Secretary of Commerce Howard Lutnick said on CBS News’ “Face The Nation.” “The president needs to reset global trade. Everybody has a trade surplus and we have a trade deficit.”
Trump, speaking to reporters on Air Force One Sunday night, downplayed inflation concerns and indicated a willingness to negotiate trade deals.
“They want to talk, but there is no talk unless they pay us a lot of money on a yearly basis,” he said.
Critics, including billionaire hedge fund manager Bill Ackman, a major backer of Trump, have voiced strong opposition to the tariffs, warning of a “self-inflicted economic nuclear winter.”
“Business is a confidence game. The president is losing the confidence of business leaders around the globe,” Ackman said.
“The consequences for our country and the millions of our citizens who have supported the president — in particular low-income consumers who are already under a huge amount of economic stress — are going to be severely negative. This is not what we voted for,” Ackman said.
