Stock, bond and commodity ETFs broadly fell Monday, with S&P 500 funds like the Vanguard S&P 500 ETF (VOO) briefly tumbling into bear market territory amid wild gyrations sparked by President Donald Trump’s global tariffs.
The biggest U.S. exchange-traded funds, including VOO, the SPDR S&P 500 Trust (SPY) and the iShares Core S&P 500 ETF (IVV), which together hold more than $1.5 trillion in assets (or more than 10% of the entire ETF market), fell for a third day straight. They’ve each lost 10% over that time frame and are down almost 20% since the February all-time high.
Safe-haven ETFs also dropped: The $125.6 billion iShares Core U.S. Aggregate Bond ETF (AGG) and the $128.9 billion Vanguard Total Bond Market ETF (BND) fell, while the $43.3 billion SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) just barely ended in the green.
Market volatility surged to its highest since the 2020 pandemic, as measured by the Cboe Volatility Index (VIX). In a sign of how itchy investors’ trigger fingers have become, the market briefly soared mid-morning, turning positive following reports—which were later disavowed—that tariffs would be paused for 90 days.
Rattling markets further was Trump’s threat for another 50% tariff on China.
“The name of the game now is uncertainty across the board with investors,” said Tim Urbanowicz, CFA, chief investment strategist at Innovator ETFs, likening the current environment to that of the pandemic meltdown. “The uncertainty is not going away. We don’t think it’s peaked yet.”
Investors traded around $850 million in so-called buffer ETFs on Friday, he said. Those funds hedge against volatility by limiting their losses and gains. Innovator is telling investors to be prepared for a “wide range of outcomes,” he said.
Source: etf.com data
Market screens were a sea of red today, with few investments gaining. The VanEck Semiconductor ETF (SMH) moved higher by 1.5% along with the iShares Silver Trust (SLV), which was up 0.4% at the close. Beyond those rare green signs, investors found few places of refuge.
“Today, we feel bewildered, angry and shocked,” Allan Roth, etf.com columnist and founder of financial planning firm Wealth Logic, wrote in an email. “I agree with the sentiment that this is ‘a self-inflicted wound.’”
