Leading investors are advising against panic during market downturns.

Global stock markets experienced a significant downturn at the start of the week, driven by investor concerns about a potential U.S. recession due to weakening economic indicators. Japan’s Nikkei 225 saw its largest single-day drop since 1987, plummeting 12.4%, while South Korea’s Kospi index fell by 8.7%. In Europe, the Stoxx 600 index declined by over 2%, and U.S. stocks also faced sharp losses on Monday. Despite these declines, some investors and strategists advised against panic, with JPMorgan’s top chart analyst suggesting this could be the beginning of a larger trend.

Ed Yardeni, president of Yardeni Research, believes the market will stabilize once the unwinding of the Japanese yen carry trade concludes. He emphasized that the current sell-off is largely driven by these carry trades and expects a quick recovery once they are resolved. Yardeni remains optimistic about the U.S. economy and labor market despite recent disappointing payroll data.

Raymond James’ CIO Larry Adam remains bullish on the tech sector, viewing the recent market volatility as a buying opportunity. He noted that the broader market typically experiences several 5% pullbacks annually and reiterated his year-end target of 5,400 for the S&P 500, favoring mega-cap tech companies due to their attractive valuations and strong earnings growth.

Macquarie’s Viktor Shvets described the market sell-off as a “stampede” driven by fears of the Federal Reserve’s interest rate policies, a potential tech bubble, and the unwinding of the yen carry trade. However, he believes the U.S. can avoid a recession and sees the current market conditions as a buying opportunity rather than a reason to sell.

Jeff Kilburg, CEO of KKM Financial, also views the increased market volatility as a chance to reposition and find buying opportunities, particularly in stocks like Tesla. He emphasized the importance of using the Cboe Volatility Index (VIX) to manage risk and capitalize on market fear.

Nationwide’s chief of investment research, Mark Hackett, sees the market’s volatility as an overreaction and a buying opportunity for disciplined investors. He advised focusing on undervalued sectors such as small-cap stocks, value names, and international stocks.

Ned Davis Research’s Joe Kalish suggested that markets might be overreacting to recent data, which has contributed to the global sell-off. He noted that weather-related impacts might have overstated the weakness in recent reports and that the market’s expectations for rate cuts might be premature.

Wolfe Research’s Chris Senyek remains optimistic about the artificial intelligence (AI) theme despite the mixed tech earnings season and market volatility. He believes the AI trend is still in its early stages and expects it to continue growing.

JPMorgan’s Jason Hunter warned that the S&P 500 could see further declines, suggesting that the current sell-off might be the start of a larger downturn. He identified key levels to watch for potential further declines.

Gina Bolvin of Bolvin Wealth Management noted that while the Federal Reserve could still achieve a soft landing for the U.S. economy, the recent market sell-off makes it more challenging. She highlighted the importance of considering the broader set of economic data beyond the recent labor market report.

Moody’s Analytics chief economist Mark Zandi criticized the Federal Reserve for not cutting rates sooner and suggested that a 50-basis point rate cut would be more appropriate. He expressed concerns about the weakening labor market and the potential for a recession if consumer spending declines.

BMO Capital Markets’ Brian Belski maintained his bullish outlook, viewing the market sell-off as a normal part of the broader trend towards normalization. He advised investors to focus on small to mid-cap stocks and mega-cap tech companies, which he sees as essential holdings.

RBC’s Lori Calvasina pointed out that the sell-off might be driven by more than just disappointing U.S. data, including stretched positioning in equity futures and seasonal factors. She suggested that the market might be experiencing a typical pullback rather than a sign of an impending recession.

Nomura Holdings’ Yoshitaka Suda warned of further unwinding of long positions in U.S. equities, driven by fears of an economic slowdown. He noted that investors are likely to continue reducing their exposure to U.S. stocks as long as the S&P 500 remains below key levels.

Tezos blockchain co-founder Kathleen Breitman commented on the sharp decline in Bitcoin, noting that its narrative as a store of value is being challenged. However, she acknowledged its utility for transactions.

Wharton professor Jeremy Siegel called for the Federal Reserve to cut rates by 75 basis points twice, arguing that the central bank has overshot its targets for employment and inflation. He criticized the Fed’s slow response and emphasized the need for rate cuts to support the economy.

Fundstrat’s Tom Lee advised investors to monitor the VIX as a key indicator during the market sell-off. He suggested that once volatility subsides, the market could quickly rebound, presenting a significant opportunity for investors.

HSBC’s data indicated that market sell-offs typically last about a month, with the S&P 500 losing an average of 10%. Strategist Duncan Toms suggested that this could present an opportunity to increase risk exposure, but not immediately.

Victoria Greene of G Squared Private Wealth and Nimrit Kang of NorthStar Asset Management both advised against panic, suggesting that the sell-off might be an overreaction and a normal intra-year decline.

Several analysts, including Dan Ives of Wedbush and Gene Goldman of Cetera, emphasized that it is not the time to panic and that the market’s reaction might be exaggerated. They suggested that the Federal Reserve is more likely to cut rates by 25 basis points rather than the 50 basis points priced in by the market.

Oppenheimer’s John Stoltzfus advised investors to remain calm and not jump to conclusions based on the recent sell-off, noting the inherent volatility in monthly jobs data.

Evercore ISI’s Ed Hyman highlighted the increasing signs of a recession, driven by weak employment reports, a Nasdaq correction, and declining bond yields and commodity prices. He suggested that the odds of a soft landing could increase if inflation falls further, allowing the Fed to be more aggressive.

Adam Crisafulli of Vital Knowledge noted that fears of a U.S. recession are driving a global risk-unwind, with tech stocks being hit particularly hard. He attributed the velocity and magnitude of the sell-off to technical factors and portfolio damage, creating a negative feedback loop.

Overall, while the market sell-off has raised concerns about a potential recession, many analysts and strategists see it as a buying opportunity and advise against panic. They emphasize the importance of focusing on long-term fundamentals and using volatility to manage risk and find investment opportunities.