Sherwood told BT Sport: "It looks big, it's a real blow to us but we've got to bounce back. We've got the second leg of the Europa League match and then we've got Cardiff at home.
"We need characters in the dressing room to be able to do that. We can't use Thursday's game at Dnipro as an excuse, especially as we were stronger in the second-half.
"We created a few chances after going behind, but we just couldn't take them. It's the first major setback I've had as manager, and now the players must respond."
Liverpool had beaten Swansea 4-3 at Anfield earlier on Sunday.