Stock Market Crash?
Stock Market Crash
Written by Matt McCabe | Principal Financial Planner | Newcastle Advisors | Friday, 4th April 2025
With the headlines screaming “bloodbath on Wall Street” and “$2.7 trillion wiped off global markets”, it’s understandable if you’ve logged into your super or investment account and winced.
The US stock market dropped 4.68% overnight—the biggest one-day fall since 2022. The cause? A sharp escalation in global trade tensions following a sweeping series of tariffs imposed by US President Donald Trump on countries including China, Japan and the European Union.
If you're feeling unsettled, you're not alone. At Newcastle Advisors, we’re speaking to clients every day across Lake Macquarie, Newcastle and the Hunter who are worried about what this market volatility means for their future.
So, let’s unpack what’s really going on—and more importantly, what to do next.
Yes, Your Portfolio Might Look Ugly Right Now
Let’s not sugar-coat it. Market volatility doesn’t feel good. You’ve worked hard, saved diligently, and seeing your portfolio drop overnight can be confronting.
But before making any knee-jerk decisions, let’s zoom out and take a breath.
Why Is This Happening?
The recent market drop is largely driven by Trump’s tariffs, which have rattled global markets. Countries like France and Canada are now threatening retaliation, while companies like Apple, Amazon, Nike, and HP have seen double-digit drops in share value.
But here’s the thing—this fear has been building, and it only takes a few bad days of headlines to spark a sharp selloff. And as we know, fear sells. Words like "crash", "wipeout", and "bloodbath" are great for clicks—but they’re terrible for calm, rational decision-making.
There’s Only So Much Bad News That Can Be Priced In
Here’s a truth seasoned investors understand: markets eventually reach an inflection point.
After a selloff like this, markets often enter a phase where bad news is actually better than worse news—and that’s when things start to settle and recover.
We’ve seen this before. In 2020, during the early days of COVID, the US market dropped 11.98% in a single day.
In 2023, we had another sharp pullback.
Yet today, despite all of that, the US market is still up 116% over the past five years. That’s more than doubling your money, even with some gut-wrenching dips along the way.
4% Drops Are Rare—And Often Followed by Strong Gains
Sharp one-day drops like the one we just saw are not common. But historically, when the S&P 500 falls 4% or more in a single session, the following 1, 6, and 12-month periods are often strongly positive.
That’s because the market tends to overreact in the short term—and then correct itself as cooler heads prevail.
What Does This Mean for You?
Let’s bring this closer to home.
Most investors in Newcastle and Lake Macquarie are diversified. You’re not 100% exposed to US stocks, which means the impact on your portfolio is likely much smaller than the headlines suggest.
Here's an estimate:
50% US exposure = approx. 2.3% drop
25% exposure = approx. 1.15% drop
10% exposure = approx. 0.46% drop
This is why having a long-term plan backed by expert financial advice is so important. It helps remove the emotion and stay focused on what truly matters.
Is There an Opportunity Here?
Absolutely.
If you’ve got cash sitting on the sidelines, this could be a strategic time to dollar-cost average into quality investments at discounted prices. It’s one of the quiet advantages that disciplined investors use to grow wealth over time.
The Value of Expert Financial Advice
During times like these, the value of financial advice becomes crystal clear. A trusted expert can help you:
Make sense of market movements
Avoid emotional decisions
Stay aligned with your long-term goals
Spot opportunities others might miss
Whether you’re close to retirement or just starting your wealth journey, having a calm, experienced voice in your corner makes all the difference.
Final Thought: Time In, Not Timing
Trying to predict short-term market movements is a losing game. The real wins come from staying invested, staying diversified, and staying focused.
At Newcastle Advisors, we provide trusted financial advice to clients in Newcastle, Lake Macquarie, and across Australia, helping families make smart, strategic decisions in all market conditions.
If you’re worried, curious, or just want to talk through your options—we’re here to help.
Book a Strategy Chat with Matt McCabe
Let’s review your current position and make sure your strategy is still on track.
Email us directly on info@newcastleadvisor.com