empty
26.03.2025 08:00 AM
Markets Won't Rush Headfirst into the Fire

Donald Trump has dealt such a heavy blow to globalization that conditions and outlooks for the future have changed—now divided along territorial lines. While European banks believe the S&P 500's decline will continue, their American counterparts argue that the time to sell the rally is over. In both cases, tariffs play a central role.

JP Morgan sees the risk of a renewed correction in the broad stock index as low, while Morgan Stanley considers the S&P 500 rally to be gaining momentum, expecting clarity on the White House's tariffs after April 2. The idea is that markets mostly feared the approach of import duties. Once that materializes, there'll be nothing left to fear. "The anticipation of death is worse than death itself." Time to buy U.S. stocks! Increasing the likelihood of consolidation.

In contrast, Swiss bank UBS and UK-based HSBC remain in the bearish camp. UBS cut its S&P 500 forecast to 5,300, citing warning signs in the latest U.S. macro data, which they argue justify selling the index. HSBC claims the chances of uncertainty disappearing after April 2 are slim. Ongoing tariff noise will affect American business and the economy, leading to further stock declines.

S&P 500 Forecast Trends

This image is no longer relevant

The Wall Street consensus expects a 13% rise from current levels to 6,539. Oppenheimer's John Stoltzfus target is the most bullish, at 7,100, while Stifel's Barry Bannister's target is the most bearish, at 5,500.

Overall, it must be acknowledged that markets have absorbed the negative impact of Donald Trump's policies without the upside. We're talking about a cooling U.S. economy, fading hopes for additional fiscal stimulus from Washington, an unstable tariff strategy, and an unexpectedly strong response from Europe. All this has led to capital outflows from the New World to the Old, contributing to the S&P 500's decline. Is the rough patch for the broad index over?

U.S. Consumer Sentiment Dynamics

This image is no longer relevant

Markets had been climbing on rumors of less severe White House tariffs than previously feared. Trump mentioned potential exemptions but then stated he doesn't like granting them. Combined with the consumer confidence index dropping to a four-year low, this clipped the wings of S&P 500 buyers.

This image is no longer relevant

Until the import tariff situation is clearer, the chance of the broad index consolidating remains high. Few investors are willing to jump into the fire ahead of such a key event, making choppy, directionless fluctuations more probable.

Technically, the bulls' counterattack continues on the S&P 500 daily chart. Traders who opened long positions from 5,670 are "sitting pretty." However, if the index bounces off resistance levels — the pivot zones at 5,815, 5,835, and 5,885 — it may trigger a reversal and shift toward selling.

Marek Petkovich,
Analytical expert of InstaForex
© 2007-2025
Summary
Urgency
Analytic
Igor Kovalyov
Start trade
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

What to Pay Attention to on July 14? A Breakdown of Fundamental Events for Beginners

There are no macroeconomic reports scheduled for Monday. Let us recall that last week, there were also no significant reports, speeches, or any other notable events in either the European

Paolo Greco 06:30 2025-07-14 UTC+2

GBP/USD Overview – July 14. Keep Calm and Carry On

The GBP/USD currency pair showed a rather significant decline on Friday. Overall, the British currency has been falling for two weeks now, and this is a very important fact that

Paolo Greco 04:33 2025-07-14 UTC+2

EUR/USD Overview – July 14. The Fed's and Trump's Positions Remain Unchanged

The EUR/USD currency pair continued a mild and weak downward movement on Friday. As we have mentioned many times before, the current move is a pure correction, so there

Paolo Greco 04:33 2025-07-14 UTC+2

The Dollar Is Becoming a Risk Currency

In my reviews, I've regularly noted that the decline in demand for the U.S. dollar is not just a matter of price depreciation. We're talking about a currency that

Chin Zhao 00:42 2025-07-14 UTC+2

The Market Believes Trump Will Back Down

What is happening in the financial markets right now can only be described as a paradox, and many economists are noting it. Take the U.S. stock market, for example: initially

Chin Zhao 00:42 2025-07-14 UTC+2

EUR/USD. Weekly Preview: U.S. Inflation, Retail Sales, ZEW Indices, and China's GDP

The upcoming trading week will be marked by U.S. inflation data. Reports on CPI and PPI growth will be released, along with the University of Michigan Consumer Sentiment Index. However

Irina Manzenko 00:41 2025-07-14 UTC+2

U.S. Dollar. Weekly Preview

In the upcoming week in the U.S., reports on inflation and industrial production will be released, along with a few other moderately interesting indicators. The most important one is undoubtedly

Chin Zhao 00:41 2025-07-14 UTC+2

British Pound. Weekly Preview

Over the past two weeks, the pound has declined more than the euro, yet the wave patterns of both instruments are almost identical. Accordingly, a three-wave corrective structure should also

Chin Zhao 00:41 2025-07-14 UTC+2

USD/JPY. Analysis and Forecast

Earlier, U.S. President Donald Trump imposed 25% tariffs on all Japanese exports to the United States, which will take effect on August 1. This move exacerbates Japan's economic challenges, which

Irina Yanina 14:21 2025-07-11 UTC+2

Market fears nothing

The S&P 500 reached another all-time high, with rotation being the hallmark of the US equity market. Investors are aggressively buying up stocks that underperformed in the first half

Marek Petkovich 10:50 2025-07-11 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.