Here’s savvy advice on what to do with tech stocks now

Stocks have made some wild swings as Wall Street tries to parse through tariff policy changes and economic news. President Donald Trump announced a handful of higher-than-expected tariffs on April 2, which sent shares tumbling.

The market ultimately ended higher last week after Trump paused most of the tariffs. Now, the main focus is on the early stages of a trade war between the world’s two largest economies.

Some investors may feel driven to cut and run. Steve Sosnick, chief strategist at Interactive Brokers, told Barron’s that every person’s investment needs are different—and whether someone is looking to buy a house in the near future, retire, or is willing to wait it out will ultimately influence what decisions they should be making.

“You should always be keeping a certain amount of your assets in low-volatility cash equivalents because you don’t want to be gambling with money that you need to spend," Sosnick said.

When it comes to tech specifically, there are a lot of different factors that can impact where the stocks go from here and how defensive they may be. Some companies have heavier exposure to China, specifically when it comes to importing goods. This includes iPhone maker Apple and e-commerce giant Amazon.com. According to the U.S. Customs and Border Protection Agency, smartphones and other technology goods will be exempt from some tariffs. Some tariffs will remain, and the prices of those goods could skyrocket if more tariffs come into play, which may hit consumer demand.

“You want to look at companies that are not as exposed to the equipment and the cost of having to pay the tariffs from China specifically," said Paul Stanley, chief investment officer at Granite Bay Wealth Management. Those “that started to move their manufacturing to Vietnam and India and some of these other countries, they may have a quicker recovery."

There is also risk for companies that sell software and advertising space. A broader economic slowdown could cause enterprises cut back their spending budgets.

“I don’t think you want to go into a recession being massively overweight tech, but I do think there’s going to be some particularly more defensive tech stocks that do quite well and that are quite resilient in a recession," John Belton, portfolio manager at Gabelli Funds, told Barron’s.

Belton thinks Microsoft can weather the storm and should be a haven among the Mag 7. When it comes to software, Belton likes ServiceNow and Intuit, which have been launching generative artificial intelligence applications to improve productivity. Then there is Netflix, which Belton likes because its ad tier offers users a lower-priced option to get access to their favorite content.

The volatility in markets will likely continue as tech earnings season approaches in a few weeks. Robert Ruggirello, chief investment officer at Brave Eagle Wealth Management, said the numbers companies share from the last three months are going to be the most irrelevant historically. That is because Wall Street is going to be listening to what companies have to say about guidance.

“If I were the management team, I would just suspend guidance, because the stock has already been pummeled. They really don’t know any better where this is going. So why not just take the whole big bath right now?" Ruggirello said, adding that management teams can take the path of underpromising now, then overdelivering as the year goes on.

If possible, several of these experts recommend not making any major portfolio changes just yet.

“If you’re already in tech, I think the only thing to do is hang on and ride it out, because ultimately long-term, these are the biggest best run drivers of growth in our economy, and they’re going to be fine," Stanley said.

He added that he can’t time the market and predict when these stocks can rebound, but he feels confident that “when you look three, four, five, 10 years out, you’re going to be happy that you didn’t sell the stocks."

Write to Angela Palumbo at angela.palumbo@dowjones.com