Fast Money panelist Karen Finerman discusses the current state of the US stock market and her confidence in the Magnificent Seven stocks.

We won't sugarcoat the situation; it's tough out there. It's the kind of scenario that makes you want to pour a glass of wine and nervously check your 401k. So what’s happening in the US stock market?

Trump’s 10% tariffs took effect on Saturday, and by Sunday night, the S&P 500 had dropped 15% since Inauguration Day, marking its worst performance since the pandemic began in 2020. Trump remarked, “I don’t want anything to go down, but sometimes you have to take medicine to fix something.” Not the reassurance we were hoping for.

We understand how disheartening it is to see your long-term investments plummet, especially with retirement on the horizon. But one thing is certain: markets recover. They always have and always will. The trick is to remain smart, calm, and invested.

Karen Finerman joined Jean Chatzky on a podcast to break down the situation in the US stock market and what actions you should be taking right now. Karen is a panelist on CNBC’s Fast Money, the CEO of Metropolitan Capital Advisors, and a co-founder of an investing club for women, InvestingFixx.

Chaos in the US Stock Market

Jean Chatzky: What’s your take on all this, Karen?

Karen Finerman: The rollout of tariffs surprised everyone, raising concerns about the actual implications. The US stock market dislikes uncertainty.

Instead of clarity on Liberation Day, we got more chaos. Over the weekend, China retaliated, adding to the anxiety about economic impacts. As a long-term investor, I focus on where I believe we'll be down the line, and I expect it to be higher than now.

Importance of Strong Balance Sheets in Tech Stocks

Jean Chatzky: Let’s discuss tech stocks. Many 401k millionaires have emerged thanks to the Magnificent Seven lately. Apple, which we added to our InvestingFixx portfolio last November, has taken a hit. How do you feel about the Magnificent Seven now?

Karen Finerman: I have a significant allocation in the Magnificent Seven, so it's been a tough ride, but I still have faith in these stocks. What I appreciate about them, including Apple, is their strong cash flow and solid balance sheets. They won’t be pressured into decisions they don’t want to make, which reassures me.

Should You Buy the Dip or Hold Cash?

Jean Chatzky: When stocks drop, it’s hard to control what happens next. What should individual investors consider during times like this?

Karen Finerman: I’m usually inclined to buy, but for those who feel uneasy, a balanced approach—purchasing some stocks while keeping cash on hand—might be wise. You don’t have to go all in or stay completely out. I tend to stay long, so this period has been challenging, but when the VIX rises, I get uneasy and adjust my hedges. That’s what I did today.

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? FinanceFixx – A 4 or 8-week Money Makeover financial coaching program to help you regain control of your finances!

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