Markets Wobble as Tariffs Return – But Long-Term Resilience Prevails

Markets sold off sharply early in the week due to uncertainty around trade policies and fears of retaliatory tariffs disrupting global supply chains; major indexes dropped – Dow -0.94%, S&P 500 -0.79%, Nasdaq -0.91%. 

Index	Weekly Change	YTD Performance	Key Driver This Week
S&P 500	+0.4%	+6.8%	Rebound on dovish Fed talk & liquidity inflow outlook
Euro STOXX 50	+0.5%	+6.6%	Earnings resilience; less exposed to U.S. tariffs
FTSE 100	Record Close	+9%	Strong commodity sector + reform hopes (stamp duty)

Trade-sensitive companies led the decline, with Tesla, Apple, and Alphabet among the hardest hit due to their significant global exposure. 

Elon Musk’s surprise political move launching the ‘America Party’ raised investor worries about his focus on Tesla’s business. This triggered a sharp selloff in Tesla shares and dragged broader tech sentiment down. 

But investors saw the trade tensions as primarily affecting the U.S. and Asia, not Europe directly. 

Germany’s DAX rose about 1.2% and the STOXX 600 gained 0.4%, driven by investor demand for relatively safer, undervalued European stocks amid global uncertainty. 

The UK’s FTSE 100 underperformed early in the week, weighed down by weak earnings from energy giant Shell, but rebounded later thanks to strength in mining and commodity sectors. 

European markets benefited from a lower tech exposure and a more cyclical sector mix, which provided some insulation from global risk-off sentiment during early-week volatility. 

Fed Governor Christopher Waller’s dovish remarks signalled his support for an interest rate cut at the July meeting, citing easing inflation and a still-robust U.S. jobs market as justification for acting sooner rather than later. 

He also suggested that the Fed shift more of its bond holdings from long-term securities into short-term Treasuries to reduce exposure if inflation picks up again or market conditions deteriorate suddenly. 

Bond markets welcomed the comments, with prices of short- and intermediate-term U.S. Treasuries climbing and yields falling – the 2-year yield dropped to around 4.1%, while the 10-year yield dipped below 4.4%. 

This matters for investors because when interest rates fall, bonds generally become more attractive, especially those with shorter terms that aren’t as affected by rate changes. 

It also suggests that the central bank might start supporting the economy more by cutting rates, which could push bond prices even higher. For anyone already holding bonds, that’s good news – as rates drop, the value of those bonds can go up, giving investors the chance to make a profit if they sell. 

At times like these, amid the media noise surrounding Trump’s tariff announcements and their short-term impact on markets, it’s crucial to remember one of the golden rules of savvy investing: take a long-term view and resist the urge to time the market.  Unfortunately, it is very very difficult for anyone to time markets and reacting to short term market noise to try and make investment decisions rarely works. 

With Trump at the helm, we need to expect and accept volatility and learn to embrace it. Trump likes to throw hand grenades and let them explode, but by now it’s clear that much of it is smoke rather than substance. 

While some of his tariff threats may sound sweeping, much of it is posturing to gain leverage. In the short term, all we can do is watch how it plays out – but reacting impulsively is rarely the answer. 

In the long run, the outlook is far from bleak. Countries adapt, people adapt, and markets adjust. 

A few extra tariffs won’t bring the world economy to a halt, and there remain plenty of strong investment opportunities ahead. The market’s broader reaction suggests the long-term future is not defined by these headlines and it is seeing through the noise. 

At Hoxton Wealth, we help clients stay focused on their goals, and build resilient portfolios designed to thrive over time – whatever the headlines may say. 

Our approach is built on disciplined, long-term investing, personalised advice, and proactive strategies to navigate uncertainty with confidence. Whether it’s market volatility, shifting policies, or global events, we provide the clarity and perspective needed to keep your investments on track. 

In uncertain times, having a clear plan and trusted guidance makes all the difference. We’re here to help you stay the course, invest with confidence, and focus on what truly matters: achieving your long-term financial ambitions. 

If you’re feeling uncertain or want to review your portfolio – we’re here to help.  Our client services team is here to support you – they can be reached by email at client.services@hoxtonwealth.com or on WhatsApp through our new global client services WhatsApp number: +44 7384 100200 

Don’t worry about forecasting every market move – the key is to have a solid plan and stay committed. 

Progress comes from steady, thoughtful steps. Let’s keep moving forward.