The legendary Bill Gross warns: Don’t catch the falling knife in the market.

The legendary investor Bill Gross advised investors not to attempt buying during downturns following the largest stock market drop since the pandemic.

“This is an epic economic and market event, similar to 1971 and the end of the gold standard, but with immediate negative consequences,” Gross said in a post on social media platform X, after making a similar statement to Bloomberg News.

“Investors should not try to catch a falling knife,” he added, clarifying that today’s bargains will still be available tomorrow and the next day.

Gross recommended buying domestic companies like AT&T, Verizon Communications, and Altria due to their relatively safe dividends in a declining interest rate environment. “Even with them, caution is needed — they are approaching the ‘saturated’ zone,” he said.

All three stocks mentioned by Gross rose on Thursday, despite the broad Dow Jones Industrial Average index falling by 1,679 points after President Donald Trump announced an increase in tariffs, surpassing the levels of the Smoot-Hawley Tariff Act of 1930, which many believe worsened the Great Depression.

AT&T has a relative strength index (RSI) of 68.82, Verizon has 62.44, and Altria has 52.86. An RSI is considered overbought when it is above 70. In comparison, the same indicator for the S&P 500 is 31.92 — values below 30 are considered “oversold.”

AT&T:

Verizon Communications:

Altria:

Gross became famous as the co-founder of Pacific Investment Management, where he earned the title “King of Bonds.” He built his fortune aggressively trading bonds at a time when other investors, including insurers and pension funds, were less active.