Worst quarter since 2022 – and no floor in sight for US stocks: deVere Group

US stocks have just closed their worst quarter since 2022—and the pain isn’t over yet, warns the CEO of global financial advisory giant,deVere Group.

Nigel Green’s warning comes as the S&P 500 fell 4.6% in the first quarter of 2025, its sharpest drop in almost three years, as concerns mount that President Donald Trump’s escalating tariff war could tip the US into a dangerous mix of slowing growth and rising prices.

For investors hoping for a rebound, the message from one of the world’s largest independent financial advisory organisations is clear: “don’t expect a floor just yet.”

“Markets are being hit on multiple fronts—and it’s all pointing toward further downside risk in the near term,” says Nigel Green, CEO of deVere Group.

“We are seeing the early signs of a stagflationary environment emerging, driven not by external shocks but by deliberate policy. That combination is a toxic one for equities.”

Investor anxiety is building ahead of Trump’s so-called Liberation Day event on Wednesday, where he is expected to double down on his trade agenda by announcing a fresh wave of universal tariffs.

These would come on top of existing levies on key imports like steel and aluminium, which have already rattled supply chains and lifted costs for American businesses.

“The market has not priced in the full impact of what’s coming,” Nigel Green adds.

“There’s a growing disconnect between the political message and the economic consequences. If tariffs keep rising while demand slows and inflation sticks, it’s hard to find any meaningful support level for US stocks in the short term.”

That fear is now being reflected in sentiment data, with consumer and business confidence both weakening. Several key surveys have pointed to a loss of momentum, especially in manufacturing and services—critical areas that are particularly sensitive to cost pressures and international uncertainty.

“We’re seeing companies delay investment and hiring decisions as they wait for clarity. But clarity isn’t coming,” notes the deVere chief executive.

“Instead, we get policy by slogan, with unpredictable consequences. And that’s the worst environment imaginable for business leaders trying to plan for the future.”

According to deVere analysts, the market’s drop in Q1 may not be a temporary wobble—it could be the early stage of a broader reset as investors reassess earnings expectations, valuations, and geopolitical risk.

“We’ve been cautious for some time, and the latest data confirms that positioning,” says Nigel Green.

“The rally we saw last year was built on the hope that interest rates would fall quickly and that global trade tensions would ease. Neither of those hopes has materialized. In fact, we’re moving in the opposite direction.”

The current outlook presents a sharp challenge for those who believed the US market could defy gravity through 2025. Instead, with monetary policy still tight, inflationary pressures being re-energised by protectionism, and corporate margins under threat, the risk of further sell-offs remains high.

For long-term investors, deVere says the key now is strategic positioning, risk management, and global diversification. The days of relying on US tech-heavy indices to carry portfolios are, for now, behind us.

“This is a moment to rethink assumptions,” Green says. “We could still see sharp rallies in response to specific events, but the underlying trend has changed. The market is digesting a new political reality—and that digestion is going to be messy.”

With no clear end in sight to the administration’s aggressive trade stance, deVere is advising clients to remain alert to short-term volatility and to position for a broader range of scenarios.

“There’s a difference between being fearful and being prepared,” concludes Nigel Green.

“We don’t believe the floor has been found yet—but we do believe opportunities will emerge for those watching closely and acting with discipline. Sitting still in this environment is not an option.”