Australia's largest superannuation fund, AustralianSuper, intends to remain invested in US shares despite recent market volatility.
In the Australian Financial Review (AFR), AustralianSuper's head of international equities, Mark Hargraves, said they would not be following in the footsteps of other major asset managers, like BlackRock, which have shifted some of their investments from the US to Europe.
In fact, Hargraves believes the European Union (EU) will suffer most from the new US tariffs.
Speaking before the US announced a 20% tariff on imports from the EU, Hargraves said:
Europe has a lot of companies that export globally and, therefore, for them, tariffs are a headwind.
[Europe has a] large automotive industry, it's got a large industrial export market too … those global European companies that are
exporters will be caught up in the wider uncertainties on tariffs.
We've already seen an example of this today.
ASX 300 retail stock Cettire Ltd (ASX: CTT), which sells a range of luxury European fashion goods worldwide, slumped 20% in earlier trading after the company said major European brands would raise their prices for US consumers to offset the impact of the US tariffs.
Image source: Getty Images
What's happening with the S&P 500?
US stocks have been volatile due to fears that new tariffs may eventually flow through to US consumer prices and weaken demand.
This could put the economy at risk of a recession, which would hurt American businesses.
In an interview, US President Donald Trump admitted there may be a "period of transition" for the economy as the tariffs were rolled out.
The S&P 500 Index (SP: .INX) officially entered a market correction on 13 March after falling 10.13% in just one month.
The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) entered a market correction a week earlier.
A correction is defined as a major index falling 10% from its most recent peak.
US shares have since rebounded, helped along by the US Federal Reserve's decision to leave interest rates on hold last month.
Overnight, the S&P 500 closed 0.67% higher at 5,670.97 points.
It has rebounded by 2.71% since hitting the correction's trough on 13 March.
But the US stock benchmark index remains 7.7% lower than its record high of 6,144.15 points on 19 February.
The Nasdaq closed 0.87% higher at 17,601.05 points. It has also rebounded since 13 March, but its recovery has been more volatile.
The index remains down 12.24% from its record peak of 20,056.25 points on 19 February.
Hargraves sees this as an opportunity, commenting:
This pullback gives you an opportunity to look at things and an area that's pulled back a lot is obviously the technology sector.
If you feel that those trends towards a more digital economy exist, well, you've just been presented with an interesting opportunity to consider adding an investment or reviewing a company you previously felt was maybe a little expensive.
Goldman Sachs downgrades forecast for US stocks twice within just weeks
Goldman Sachs has revised its forecast for S&P 500 returns in 2025 for a second time in less than a month.
The broker published a forecast last November tipping the S&P 500 to rise to 6,500 points by the end of 2025.
Goldman changed that forecast to 6,200 points in early March due to expectations of weaker economic growth.
Later in the month, the broker revised that forecast down again to 5,900 points.
Over the next quarter, the broker says the S&P 500 may go as low as 5,300 points.
