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

USD/JPY. Analysis and Forecast

The USD/JPY pair is holding above the key 144.00 level amid continued weakness in the U.S. dollar. Strong household spending data released today in Japan has strengthened expectations

Irina Yanina 18:12 2025-07-04 UTC+2

NZD/USD. Analysis and Forecast

The NZD/USD currency pair is recovering after bouncing from the 0.6030 level, which marks a weekly low, and is attempting to gain further positive momentum. This suggests a break

Irina Yanina 18:08 2025-07-04 UTC+2

USD/CAD. Analysis and Forecast

On Friday, the USD/CAD pair remains near a three-week low, trading below the key 1.3600 level. The U.S. dollar is struggling to extend its gains following yesterday's stronger-than-expected Nonfarm Payrolls

Irina Yanina 17:59 2025-07-04 UTC+2

The Market Celebrates a Victory

Financial markets responded positively to the release of U.S. employment statistics for June. Payrolls rose by 143,000, exceeding Bloomberg analysts' forecasts. April and May figures were revised upward

Marek Petkovich 10:15 2025-07-04 UTC+2

Next Week May Begin on a Positive Note for the Markets (Possible Resumption of Growth in #SPX and #NDX)

The U.S. labor market data, published by the Department of Labor, instilled cautious optimism among investors, extending the rally in U.S. equity markets, supporting the dollar, and weakening gold prices

Pati Gani 10:09 2025-07-04 UTC+2

The Market is Preparing for Another Shock

Just yesterday, U.S. President Donald Trump announced that his administration would begin sending letters to trade partners on Friday, outlining unilateral tariff rates that, according to him, countries will

Jakub Novak 09:55 2025-07-04 UTC+2

Strong U.S. Employment Report Exceeds All Expectations

The U.S. dollar surged against a range of risk assets as the key figures in June's employment report convinced the Federal Reserve that there is no need to lower interest

Jakub Novak 09:49 2025-07-04 UTC+2

What to Pay Attention to on July 4? A Breakdown of Fundamental Events for Beginners

No macroeconomic reports are scheduled for Friday. As previously mentioned, today is a public holiday in the United States, known as Independence Day. All banks and stock exchanges will

Paolo Greco 07:59 2025-07-04 UTC+2

GBP/USD Overview – July 4: Reeves Cried — Did the Pound Collapse?

The GBP/USD currency pair also traded fairly calmly throughout Thursday until the start of the U.S. trading session. Recall that a day earlier, the British currency had plummeted by nearly

Paolo Greco 03:56 2025-07-04 UTC+2

EUR/USD Overview – July 4: Trump's Third Trade Deal Didn't Help the Dollar Either

The EUR/USD currency pair traded very calmly throughout Thursday, until unemployment and labor market reports were released in the United States. However, we will discuss those reports in other articles

Paolo Greco 03:56 2025-07-04 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.