Auto stocks have been particularly hard hit by the tariff fears, with Ford Motor, General Motors, and Stellantis all experiencing significant declines1. The impact extends beyond the automotive sector, with tech giants also feeling the pressure. Nvidia and Tesla, part of the 'Magnificent Seven' megacaps, have led losses in their group1. President Trump's announcement of a 25% tariff on all imported vehicles and auto parts is expected to further exacerbate industry concerns, potentially disrupting global supply chains and impacting corporate profits23.

Investors are increasingly pivoting to safe-haven assets as fears of a global economic slowdown intensify, driven by President Trump's aggressive tariff policies. This shift reflects a broader flight to safety amidst heightened market volatility and recession risks. Key trends in this movement include:

• Gold's meteoric rise: Gold prices have reached unprecedented levels, surpassing $3,100 per ounce, as investors flock to this traditional hedge against economic instability12.

• Surge in U.S. Treasury demand: Yields on U.S. government bonds have stabilized above 4%, signaling strong investor confidence in their reliability during turbulent times13.

• Currency safe havens: The Swiss franc and Japanese yen have seen increased demand, appreciating modestly as traders seek stability in foreign exchange markets3.

• Defensive equities gain favor: Stocks in traditionally defensive sectors, such as utilities and healthcare, are outperforming broader market indices due to their perceived resilience in economic downturns13.

This migration underscores the deepening uncertainty surrounding trade policies and global economic health. While these assets provide a buffer against volatility, experts warn that even safe havens may face pressure if recession fears continue to escalate13.

The S&P 500's decline has intensified, with the index now down over 5% year-to-date and on track for its worst quarter compared to global markets since 198812. This underperformance is largely attributed to President Trump's tariff policies and growing recession fears. Key factors contributing to the market downturn include:

• Heightened volatility, with the Cboe Volatility Index surpassing 241

• Significant losses in tech and AI stocks, particularly affecting the 'Magnificent Seven' megacaps13

• Reduced investor confidence, with the American Association of Individual Investors reporting bearish sentiment above 60%, a level reached only six times since 19874

• Downward revisions of S&P 500 targets by major financial institutions, with Goldman Sachs lowering its year-end forecast to 5,7005

Despite the current decline, some analysts view this as a potential buying opportunity, though many remain cautious about timing market re-entry due to ongoing economic uncertainties26.

The recession outlook for the U.S. economy has become increasingly uncertain, with major financial institutions revising their projections. Goldman Sachs has raised its 12-month recession probability to 35%, up from 20%, citing deteriorating household and business confidence12. JPMorgan echoes this sentiment, with CEO Jamie Dimon suggesting only a 35-40% chance of a "soft landing" for the economy3. These assessments are driven by several factors:

• Slowing economic growth, with Goldman Sachs forecasting 1% GDP growth in 2025, down from previous estimates1

• Rising inflation expectations, with core PCE inflation projected to reach 3.5% by end-20251

• Increasing unemployment, with Goldman Sachs forecasting a 4.5% unemployment rate by year-end 20252

• Uncertainty surrounding trade policies and potential tariff increases12

• Federal Reserve's anticipated response, with Goldman Sachs now projecting three interest rate cuts in 20254

Despite these concerns, some economists remain cautiously optimistic. Former Treasury Secretary Larry Summers puts the recession odds at about 50%, while Moody's Analytics chief economist Mark Zandi sees a 35% chance, contingent on the implementation and duration of new tariffs5.

As market volatility intensifies due to Trump's tariff policies, investors are increasingly seeking refuge in safe-haven assets. Gold has emerged as the leading safe haven, with prices soaring to a record high of $3,126.97 per ounce12. This surge reflects gold's enduring appeal as a store of value and hedge against economic uncertainty3. Other safe-haven assets gaining traction include:

• U.S. Treasury bonds, with yields stabilizing above 4% as investors seek stability4

• Safe-haven currencies like the Swiss franc and Japanese yen, which have appreciated modestly4

• Defensive stocks in sectors such as utilities and healthcare5

The shift towards these assets underscores growing concerns about global economic stability and the potential for a recession triggered by escalating trade tensions6. However, experts caution that even traditional safe havens may face challenges in the current economic climate, emphasizing the importance of diversification in risk management strategies7.