empty
24.04.2025 11:42 AM
Wall Street keeps White House in line

The market is showing heightened sensitivity to any good news, but its best days are behind it. The value of US equities as a percentage of the MSCI All Country World Index peaked in December. According to Jefferies Financial Group, investors should brace for further declines. A similar pattern occurred with Japanese equities in 1989, which was followed by sweeping global changes. Something similar may be in store for the US.

Although US equities account for 60-70% of the world's total market capitalization, America's economy does not generate a comparable share of global wealth. As a result, capital is flowing out of the US into other countries, a trend that has been accelerated by Donald Trump's protectionist policies. This phenomenon reflects not only American weakness but also investors' growing appetite for investing in Europe, Asia, and other regions.

Dynamics of US and other stock indices

This image is no longer relevant

Since Donald Trump took office, the S&P 500 has fallen by around 10%, marking the worst performance in the first 100 days of any US president. It is no surprise that the Republican is growing anxious and is now backtracking on earlier decisions. After imposing tariffs on America's "Liberation Day," a 90-day pause was announced. Following his criticism of Jerome Powell, Trump announced that he did not actually plan to fire the Fed chair.

It seems Donald Trump is still glued to the S&P 500, and the market holds power over him. During his first term as president, the Republican repeatedly equated rallies in the index with his own effectiveness. With the president's well-known fixation on the stock market, some players are trying to exploit it. First came news of a tariff pause, which was later confirmed. Now, investors are rattled by rumors that the US may unilaterally roll back tariffs against China.

Although the US administration has denied the reports, there is rarely smoke without fire. What worked once may work again. Nevertheless, some traders chose to lock in profits after several days of gains.

Dynamics of US stock indices

This image is no longer relevant

This image is no longer relevant

In this environment, the risk of medium-term consolidation in the S&P 500 is growing. Bulls are eager to buy the dip, yet they remain wary of fresh tariff threats and the risk of a recession. Bears seize on the adverse backdrop but retreat quickly on positive White House headlines. Buyers and sellers are engaged in a tug-of-war, which typically leads to the formation of trading ranges for specific financial market assets.

Technically, the daily chart shows that the S&P 500 tested the 5,400 level in an attempt to activate a 1-2-3 reversal pattern. However, the bulls' offensive was repelled, and the broad market index closed below this critical level. If the price breaks below the low of 5,350, it could become a signal to build short positions.

Marek Petkovich,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

XAU/USD. Analysis and Forecast

Today, gold maintains a positive tone; however, bulls are acting cautiously, preferring to refrain from aggressive buying ahead of the release of the important U.S. Non-Farm Payrolls (NFP) report

Irina Yanina 15:30 2025-06-06 UTC+2

WTI. West Texas Intermediate. Traders Await NFP

Prices for West Texas Intermediate (WTI) crude oil remain in the middle of a three-day range. Prices are supported by hopes for the resumption of trade negotiations between the U.S

Irina Yanina 11:23 2025-06-06 UTC+2

ECB Meeting Results and Christine Lagarde's Press Conference

The euro responded with a significant rise following the ECB's decision to cut interest rates. But why did this happen? Let's break it down. The key reason behind the euro's

Jakub Novak 10:54 2025-06-06 UTC+2

What to Pay Attention to on June 6th? Fundamental Event Analysis for Beginners

Analysis of Macroeconomic Reports: A fairly large number of macroeconomic publications are scheduled for Friday, but most of them will not interest traders. For example, the report on industrial production

Paolo Greco 10:11 2025-06-06 UTC+2

Overview for the GBP/USD pair on June 6, 2025

The GBP/USD currency pair continued its upward movement on Thursday, trading overall calmly and without any rush. There was no news for either the British pound or the U.S. dollar

Paolo Greco 05:47 2025-06-06 UTC+2

Overview for EUR/USD on June 6, 2025

The EUR/USD currency pair continued to trade very calmly on Thursday, even when the results of the ECB meeting became known. It should be noted that there was no intrigue

Paolo Greco 05:21 2025-06-06 UTC+2

The EU Economy Will Not Suffer, According to Lagarde

Today, a meeting of the European regulator took place, where the obvious and expected decision was made to lower all three interest rates by another 25 basis points. The decision

Chin Zhao 02:56 2025-06-06 UTC+2

USD/JPY. Analysis and Forecast

During the European session on Thursday, the Japanese yen maintained stability, allowing the USD/JPY pair to hold above the key 143.00 level amid a moderate rise in the U.S. dollar

Irina Yanina 12:04 2025-06-05 UTC+2

AUD/JPY. Analysis and Forecast

Today the AUD/JPY pair is attracting new buyers. Recent Chinese data, including the private Caixin survey, showed a moderate acceleration in growth in China's services sector

Irina Yanina 11:36 2025-06-05 UTC+2

USD/CAD. Analysis and Forecast

The USD/CAD pair continues to decline. Fundamental factors support bearish sentiment, indicating that the path of least resistance for spot prices remains downward. Reports of a trade agreement between

Irina Yanina 11:33 2025-06-05 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.