Tariffs, Turbulence and Your Financial Future

What You Need to Know

The global investment landscape has been shaken in recent weeks by the United States’ decision to impose sweeping new tariffs, prompting retaliatory action from China and other key trading partners. This escalation in trade tensions is already being felt across financial markets—not just in the US, but right here in the UK and across Europe.

Short-Term Impacts on Your Investments and Pensions

Markets do not respond well to uncertainty, and the effects have been immediate. The FTSE 100 fell by over 4% in the days following the US announcement, dragged down by weakness in export-heavy sectors such as manufacturing and automotive. In Europe, the Euro Stoxx 50 dipped by around 3.8% over the same period, reflecting growing investor anxiety over economic growth across the bloc.

Germany’s DAX index—widely seen as a barometer of European industrial health—has also taken a hit, with shares in key exporters like BMW and Siemens losing ground amid concerns over increased costs and reduced demand.

Across the Atlantic, the S&P 500 has dropped roughly 5% in recent weeks, and the tech-heavy NASDAQ has seen even sharper corrections due to concerns about supply chain disruption. Meanwhile, government bonds have rallied as investors seek safe havens—driving UK gilt yields to their lowest point since early 2023.

For pensions and investment portfolios, this means short-term turbulence, particularly if you’re exposed to equities or global funds with high correlation to trade-sensitive industries. Even diversified portfolios may be feeling the squeeze, especially as inflationary pressures continue to linger in both the UK and EU.

Longer-Term Implications

Looking further ahead, the picture becomes more complex. If these tariffs are part of a broader realignment of global trade, we could be entering a new investment era—marked by shifting supply chains, evolving inflation dynamics, and persistent geopolitical tension.

The Bank of England has already warned that ongoing trade friction could weigh on UK economic growth. And with the European Central Bank maintaining a cautious stance amid weak industrial output in Germany and France, it’s clear that the broader EU economy is also at risk.

However, this doesn’t necessarily spell disaster for long-term investors. Research from Fidelity International shows that historically, portfolios with diversified exposure across geographies, asset classes, and sectors tend to recover more swiftly from geopolitical shocks. The key is being proactive—not reactive.

Now Is the Time to Take Control

This is not the time to sit on your hands. Market volatility can be unsettling—but it also creates opportunity for those who know where to look and how to act.

Whether it’s revisiting your pension allocations, rebalancing your investments, or building a long-term strategy that’s resilient to global shocks, the need for expert financial advice and strategic planning has never been greater.

At Aetas Partners, we help individuals, families, and business owners make sense of fast-moving markets and take confident steps toward financial security. Our experienced team works across investment, retirement, tax and estate planning to deliver joined-up advice tailored to your goals.

Don’t let global uncertainty derail your future. Contact us today to arrange a complimentary consultation and take control of what happens next.