🔻Buying the dip

Sure, the S&P 500 erased more market value during this downturn than it did during the global financial crisis of 2008, but that wasn’t because retail traders were selling. The US stock market’s worst day since June 2020 — before it was surpassed by Friday’s mammoth losses — was, in the eyes of retail traders, the biggest buying opportunity in at least 10 years.

• “Despite a sea of red, retail investors stood firm and not only bought the dip but did so at a historic pace,” wrote JPMorgan analysts led by Emma Wu. “They ended [Thursday] with +$4.7 billion of net buying, the largest level over the past decade.”

• FWIW: this type of behavior is very different to how retail reacted to the Covid-induced shock. When the pandemic hit, retail went in on ETFs and just threw money at indexes in the anticipation that at least something was going to gain.  

• This time around, retail traders bought that dip with conviction and threw money at specific stocks like Amazon and Nvidia. 

The upshot? It may be tough out there, but in times like these, traders turn to their emotional support cache of NVDA stock. 

The Takeaway

Blood in the water evidently means a feeding frenzy for the little guys, and even though last Thursday was the worst day for the S&P 500 since 2020, retail traders managed to plow more into the market in a single day than they had in a decade.

• Globalization is over — at least the version we knew: Globalization, the early-aughts buzzword that meant countries becoming more economically, politically, and culturally interdependent, has shaped much of our day-to-day lives since the end of the Cold War. But that model seems to be unraveling as tariffs threaten the end of the global trade hegemony of the last 80 years. We whipped up five charts showing the new pivot in globalization and which international brands are eating our Western lunch. 

• Facebook’s news feed takes a right turn: We all know deep down that Facebook is not the cultural hub it once was, but it still boasts 3 billion monthly users who share vacation photos, post AI slop, and, though it’s not at the volume it once was, engage with news content. The New York Times became the platform’s most popular news source in November, but over the last four months, right-wing news sites — ranging from Fox News to Breitbart — have come roaring back. So much so that it’s worth asking not just why, but how? Here’s what we found.

We’re all staring at a more than $9 trillion hole in the S&P 500’s market value, destroyed by the downturn in momentum stocks and announcement of reciprocal tariffs.

As you stare, you might be wondering, “When will this pain end?!”

We examined six different catalysts that could change the tariff-ying market situation.

Dive in.