Close Menu
Invest Intellect
    Facebook X (Twitter) Instagram
    Invest Intellect
    Facebook X (Twitter) Instagram Pinterest
    • Home
    • Commodities
    • Cryptocurrency
    • Fintech
    • Investments
    • Precious Metal
    • Property
    • Stock Market
    Invest Intellect
    Home»Investments»How to protect your investments during Trump’s tariff market turmoil
    Investments

    How to protect your investments during Trump’s tariff market turmoil

    March 7, 20255 Mins Read


    Katie Brockman
     |  The Motley Fool

    The Trump administration implemented 25% tariffs against Canada and Mexico on March 4, as well as an additional 10% tariff on goods from China — bringing the total tariff on Chinese-made goods to 20%. The countries swifly issued retaliatory tariffs on U.S. imports, escalating tension between the countries and rattling the stock market.

    Major indexes dropped sharply after the tariffs took effect, with the S&P 500 (SNPINDEX: ^GSPC) falling by 2.96% since Monday, as of this writing. The Nasdaq (NASDAQINDEX: ^IXIC) dipped by around 2.98% in that time, while the Dow Jones Industrial Average (DJINDICES: ^DJI) slipped by 3.01%.

    If you’re feeling nervous about the future of the market, you’re not alone. Here’s how the tariffs could affect the economy, plus a game plan for protecting your investments going forward.

    How tariffs might affect the economy

    Tariffs can affect the economy and the stock market in several ways, primarily by way of raising costs and potentially influencing inflation. Ryan Monarch, an economics professor at Syracuse University, told The Motley Fool in a recent interview that we’re likely to see both short- and long-term effects of tariffs: “Tariffs cause the price of affected goods to rise. In fact, research into the 2018-2019 trade war has shown that the prices of U.S. imported goods affected by tariffs rose by nearly the entire amount of tariffs imposed, meaning that U.S. importers bore the brunt of the increase in costs.”

    “The short run is also characterized by significant uncertainty about what trade policy will look like, leading to the pulling back of investment and production for many companies,” he continued. “In the long-run, inflation expectations may become less stable, and as consumers come to expect inflation, this itself can lead the Federal Reserve to take stronger tightening actions.”

    Because the U.S. is already in a precarious position with inflation, tariffs could potentially exacerbate the problem. A 2025 study from the Federal Reserve Bank of Boston found that 25% tariffs on Canada and Mexico and the additional 10% tariff on China could increase the core inflation rate by 0.8 percentage points.

    Surging inflation could push the Federal Reserve to take more drastic measures to constrain prices — especially after the inflation rate unexpectedly increased earlier this year after months of consistently slowing.

    How to protect your investments

    When the market takes a turn for the worse, the most important thing you can do is avoid any knee-jerk reactions.

    We don’t know how long this dip will last, or whether it will turn into a larger bear market or recession. Selling off your stocks in a panic could be costly if prices rebound quickly. Case in point: When the market plunged in March 2020 due to fears surrounding the COVID-19 pandemic, those who’d continued investing throughout the downturn saw the biggest rewards when the market almost immediately recovered.

    ^SPX data by YCharts.

    Instead of avoiding the market, focus on doubling down on strong investments. Healthy companies are more likely to weather economic downturns, even if they’re hit hard in the short term. The strongest stocks will have solid business fundamentals, like a competitive advantage in the industry and a knowledgable leadership team to guide the company through rough waters.

    Downturns are a normal part of the market’s lifecycle, and the vast majority of stocks manage to pull through. Historically, every single bear market has been followed by a bull market. No matter how tough things may get, even the worst downturns are only temporary.

    ^SPX data by YCharts.

    Now is also a good time to double-check that you have a well-stocked emergency fund. If stock prices continue to drop, the last thing you’ll want to do is sell your stocks for less than you paid for them — potentially locking in steep losses. With a solid emergency fund, you can leave your money in the market even if you face an unplanned expense.

    These are nerve-wracking times for investors, and it’s normal to feel anxious about the stock market’s future. But by investing in quality companies, avoiding panic-selling your stocks, and staying in the market for the long haul, it will be much easier to protect your investments against volatility.

    Katie Brockman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

    The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.

    Should you invest $1,000 in S&P 500 Index right now?

    Offer from the Motley Fool: Before you buy stock in S&P 500 Index, consider this:

    The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and S&P 500 Index wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

    Consider when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you’d have $699,020!*

    Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. TheStock Advisorservice has more than quadrupled the return of S&P 500 since 2002*. Don’t miss out on the latest top 10 list, available when you joinStock Advisor.

    See the 10 stocks »



    Source link

    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email

    Related Posts

    Savvy Tips on Alternative Investments From a Wealth Adviser

    Investments

    Majority of Germans find defense industry investments justifiable

    Investments

    Kugan Parapen : «BRP : c’est un coup de massue, mais…»

    Investments

    CBSL warns public against misleading overseas property investment ads – The Island

    Investments

    L’intégrale de C’est Votre Argent du vendredi 20 juin

    Investments

    Couchbase rachetée par Haveli Investments pour 1,5 milliard de dollars : le titre s’envole

    Investments
    Leave A Reply Cancel Reply

    Top Picks
    Precious Metal

    Le co-créancier du projet Kefi Gold and Copper décroche l’adhésion de l’Éthiopie

    Investments

    Bharti Telecom’s Largest Bond Issuance Seeks $1.33 Billion

    Commodities

    VCSEL Performance Improves with Mode Filtering Using Metal Apertures | Research & Technology | Oct 2024

    Editors Picks

    Blawnox plans to hold line on real estate taxes

    October 17, 2024

    Monster Magnet interview: the history of the stoner rock band

    October 20, 2024

    Digital Utilities Ventures CEO Mark Gaalswyk Meets with QFFD in Qatar

    May 6, 2025

    Gold shines bright as biggest jewelry market boosts options bets

    March 9, 2025
    What's Hot

    OPP Warns of Growing Cryptocurrency Recovery Scams Targeting Fraud Victims

    April 1, 2025

    L’augmentation de capital de Peach Property obtient l’aval des actionnaires

    May 25, 2025

    Weather, Economy, Politics Topics at GFB Commodity Conference

    August 19, 2024
    Our Picks

    N. Korea holds crisis meeting to discuss minimizing agricultural damage from natural disasters

    July 23, 2024

    BHP annual profit rises 2%, says open to higher debt for acquisitions By Reuters

    August 26, 2024

    DA Price gives update on case against Radius Recycling over scrap metal fire

    October 31, 2024
    Weekly Top

    RBC Abaisse la Recommandation sur United Utilities, Jugeant le Potentiel de Hausse « Limité »

    June 22, 2025

    400 millions $ au Nigeria pour la « plus grande usine de terres rares » d’Afrique, mais…

    June 22, 2025

    Cryptocurrency Live News & Updates : Bitcoin Maintains Support; Oil Prices Stabilize

    June 22, 2025
    Editor's Pick

    This Top Energy Stock Sees Limitations for a Nuclear Energy Resurgence

    October 27, 2024

    Binance slammed for seizing Palestinian crypto for Israel

    August 28, 2024

    Back to basics: Les fintechs

    March 15, 2025
    © 2025 Invest Intellect
    • Contact us
    • Privacy Policy
    • Terms and Conditions

    Type above and press Enter to search. Press Esc to cancel.