A week after President Donald Trump launched a sweeping wave of tariffs targeting nearly every major trade partner, global markets remain shaken. Tech stocks are in a downward spiral. U.S. indices are posting their worst losses since 2020. And companies are scrambling to adjust strategies amid a deepening trade war. But while most analysts and economists are raising red flags over the potential for recession, one Wall Street firm, Jefferies, has dared to suggest there’s an upside to the chaos.
In a Sunday research note, analysts at Jefferies described the volatile economic landscape as a “free hall pass” for companies to reset expectations, lower performance targets, and recalibrate for a tougher business climate. The analysts argued that the uncertainty brought on by tariffs gives corporate leaders a unique opportunity to revise guidance downward without the usual backlash from investors.
“Lower estimates that are more achievable tend to improve investor sentiment and, ultimately, lead to better share performance,” the note read. The report was led by Brent Thill and focused on 29 tech firms, including heavyweights like Meta, Microsoft, Google, and Amazon.
While their argument reflects a contrarian view on the fallout from Trump’s latest trade salvo, Jefferies stands virtually alone in seeing any potential benefit from the tariffs. The prevailing mood among analysts, economists, and corporate leaders is one of concern—and in many cases, alarm.
Slashing Tech Targets
Among the companies hardest hit by Jefferies’ revised expectations is Meta. In the space of ten days, the firm has cut Meta’s price target twice, most recently by 17%, bringing it down from $725 to $600. The analysts also slashed Meta’s 2025 earnings-per-share (EPS) forecast by 13%, citing macroeconomic headwinds and advertising pullbacks linked to Chinese clients.
Meta’s stock has fallen by 10% over the last five trading days and now sits at $504. Microsoft’s target was cut by 5%, from $500 to $475, with shares down 3.5% over the same period. Google and Amazon fared slightly better in the analysis, with EPS estimates for 2025 reduced by 2% and 1%, respectively—though Jefferies held their price targets steady.
Analysts noted that Meta and Amazon, in particular, are vulnerable due to their exposure to Chinese advertisers, many of whom are now pausing their U.S.-oriented campaigns as a direct response to Trump’s aggressive tariff policy. “If you can’t sell, why advertise?” one marketing expert told Business Insider, underlining the abrupt shift in sentiment among Chinese brands that traditionally target American consumers.
Trade War Panic Spreads
The broader picture is far from optimistic. Last week, President Trump unveiled a barrage of new tariffs, including a 34% duty on imports from China, 46% on Vietnam, 26% on India, and 32% on Indonesia. On Friday, China fired back, imposing a retaliatory 34% tariff on all U.S. imports, effective April 10.
The tit-for-tat measures have rattled investors. The S&P 500 dropped 6%, the Dow Jones fell 5.5%, and the Nasdaq tumbled 5.8%—all recording their steepest single-day losses since the COVID-19 lockdown crash of 2020. Dow futures dipped another 2.5% on Sunday night, indicating that the carnage may extend into this week.
Asian markets opened deep in the red on Monday. Japan’s Nikkei index fell 6.5%, South Korea’s Kospi lost 4.5%, and Hong Kong’s Hang Seng dropped nearly 10%, the worst showing in years.
Amid the panic, former Treasury Secretary Larry Summers, like many others, said the tariff will only yield economic pain.
“Never before has an hour of Presidential rhetoric cost so many people so much,” he wrote on X. “The best estimate of the loss from tariff policy is now closer to $30 trillion.”
Alone in Seeing Upside
While the scale of the market reaction has prompted widespread concern, Jefferies’ note stands out for suggesting that companies might benefit from the downturn, at least in how they manage expectations. This view, however, has not found support from most analysts or economic experts, who warn that the mounting tariffs could trigger a global recession.
JPMorgan Chase CEO Jamie Dimon echoed the warning in his annual shareholder letter. Although he acknowledged the need for a firmer stance on trade, Dimon cautioned that the current tariff barrage could have damaging ripple effects across the economy.
“These actions are inflationary and disruptive,” he wrote. “Whether or not the menu of tariffs causes a recession remains in question, but it will slow down growth.” Dimon warned that the markets were pricing in a soft landing, perhaps too optimistically. “I am not so sure,” he added.
His note was a pointed, if carefully worded, rebuke of Trump’s latest trade actions. While Dimon agreed that the U.S. must address unfair trade practices, particularly with China, he warned that the current approach could backfire by undermining the post-World War II trade system that the U.S. helped create.
“America First is fine,” Dimon said, “so long as it doesn’t become America Alone.”
Strategic Reset or Recession Risk?
Despite Jefferies’ argument that lowered expectations might boost investor confidence in the long run, the mood across most of corporate America is grim. Companies from Target to Best Buy and even Ferrari have announced plans to raise prices in response to new import costs. Manufacturers warn of supply chain disruptions, and tech firms are reassessing hiring and expansion plans.
Jefferies’ optimism is framed around the idea that the second quarter of 2025, beginning this April—will mark the peak of tariff-induced uncertainty. By the second half of the year, the firm expects conditions to stabilize, allowing for a potential rebound in the fourth quarter. That recovery, however, hinges on two critical assumptions: that the trade war does not escalate further, and that companies succeed in lowering investor expectations without spooking markets further.
But if markets continue to tank and retaliatory tariffs escalate, as they did last week, those assumptions may not hold.
