Click here for the PDF: The Quarterly April 2025
With this commentary, we plan to communicate with you every month about our thoughts on the markets, some snapshots of metrics, a section on behavioral investing and finally an update on MacNicol & Associates Asset Management (MAAM). We hope you enjoy this information, and it allows you to better understand what we see going on in the marketplace.
“You can be a straight talker without being an unpleasant person.” — Jane Fraser, Citigroup CEO
Can’t Bear to watch?
Okay let’s get down to business: how bad was the sell-off in stocks during the first quarter and just after the first quarter, and should you be worried? So, the declines in the Dow, S&P500, NASDAQ and S&P/TSX as well as other markets during April 3rd, 4th, 7th and 8th were definitely noteworthy but hardly record setting. Trump era protectionist policies have roiled stocks because they create uncertainty around one of the central inputs into stock prices: corporate capital spending plans. This uncertainty and the attendant uncertainty regarding corporate profit growth are the main reasons why stocks got slammed. But if anything, it is the first quarter’s returns that were the story and not how hard equity investors got slammed last week. Either way, consider this: we have been down this road before and this too shall pass. The tapper “tantrum” of 2018, the pandemic of 2020 and the inflationary post pandemic period of 2022 each created drawdowns that scared the living hell out of all of us while they were happening but ultimately went on to become a great big nothing burger in the grander scheme of things. To illustrate my point, if I were to ask you to name just three (3) of the ten worst single day percentage corrections in stocks [that’s only 30%] do you think you could do it?
Let’s find out…
Displayed below is a table of the worst single-day corrections in the history of stocks as defined by the S&P500 from Annie Jennemann of Yahoo Finance. Not only do none of the days of the April annihilation not qualify to make it onto this list of money vaporizing days, but they would not even qualify if this list was twice as long. You read that correctly, the 20th worst day in the history of stocks, May 14th, 1940, was still worse than April 3rd, 4th, 7th or 8th.
