Wall Street Analysts Are Slashing Their Stock Market Forecasts. Here's What You Should Do, According to History.

The S&P 500 has delivered a compound annual return of 10.5% since it was established in 1957. However, the index is coming off back-to-back annual gains of more than 25% in 2023 and 2024, which is something it has only achieved one other time in its history (during the dot-com tech boom in 1997 and 1998). Many Wall Street analysts entered 2025 predicting another above-average return, citing business-friendly policies from the new Trump administration and a continuation of the artificial intelligence (AI) boom. But the reality has been very different so far -- the S&P 500 has plunged by 17% from its recent record high, as President Trump laid out plans to impose sweeping tariffs on America's trading partners last week.The tariffs could deal a blow to global economic growth, forcing Wall Street analysts to slash their 2025 price targets for the S&P 500. But no matter the trigger, stock market corrections are a normal part of investing, and history lays out a very clear playbook for dealing with them. Here's what investors should do.Continue reading

Apr 9, 2025 - 10:09

Wall Street Analysts Are Slashing Their Stock Market Forecasts. Here's What You Should Do, According to History.

The S&P 500 has delivered a compound annual return of 10.5% since it was established in 1957. However, the index is coming off back-to-back annual gains of more than 25% in 2023 and 2024, which is something it has only achieved one other time in its history (during the dot-com tech boom in 1997 and 1998).

Many Wall Street analysts entered 2025 predicting another above-average return, citing business-friendly policies from the new Trump administration and a continuation of the artificial intelligence (AI) boom. But the reality has been very different so far -- the S&P 500 has plunged by 17% from its recent record high, as President Trump laid out plans to impose sweeping tariffs on America's trading partners last week.

The tariffs could deal a blow to global economic growth, forcing Wall Street analysts to slash their 2025 price targets for the S&P 500. But no matter the trigger, stock market corrections are a normal part of investing, and history lays out a very clear playbook for dealing with them. Here's what investors should do.