Market Volatility Could last for remainder of 2025, Verdence Capital’s Megan Horneman

Stocks could still come under more pressure past President Donald Trump’s tariff exemption deadline on April 2, according to Megan Horneman at Verdence Capital Advisors.

“There’s just so much from the economic standpoint that is unknown at this point that I think even after April 2 if we have some clarity there, we still don’t know what that secondary impact is going to be to the economy,” the firm’s chief investment officer told CNBC. “We also don’t know from the inflation standpoint if this is just going to be a one-time hit to inflation or if we’re going to keep seeing this back and forth, which could have a bigger impact on inflation.”

Horneman also pointed to earnings downgrades as a key risk to the market going forward, saying “that’s the next thing that you’ll see really start to pick up.” However, while she believes 2025 in general is going to be a volatile year for equities, she anticipates a more favorable environment in the years beyond that.

“We still are positive longer term,” Horneman added. “We think that the Trump administration is front-loading all of these policies to the first couple months that he’s in office so that he can clear that docket and set up for extension of the Tax Cuts and Jobs Act. That’ll be the next battle in the second half of this year.”

— Sean Conlon