Investing pros are predicting economic downturn due to tariffs and potential recession risks

From Yahoo Finance: 2025-04-05 12:30:00

Wall Street is in panic mode over the outlook for the rest of 2025 after a historic stock sell-off fueled by tariffs. Major indexes suffered their worst week since 2020, with the S&P 500 losing nearly 7% and the Nasdaq 100 slipping into bear market territory.

Tariffs have pushed the US economy closer to a downturn, according to John Hussman. JPMorgan raised the risk of a coming recession to 60%, citing disruptive US policies as the biggest threat. Other countries, like China, are retaliating against US tariffs, potentially slowing global growth.

The Fed could cut interest rates faster than expected in response to economic weakness. Investors believe the outlook for stocks has worsened significantly in the event of a prolonged trade war. Wedbush Securities sees challenges ahead for the artificial intelligence trade, warning of economic Armageddon and a crush on the tech industry.

Read more: What investing pros are saying after a historic 2-day stock market crash