The trade war is intensifying, and while President Donald Trump praises his pricing deadline of April 2 as a “liberation day” of America, the formerly stirred investors feel volatility.
A quick glance on the stock market shows the damage that the president’s trade policy has inflicted on investors’ confidence so far. After consecutive years of two -digit gains, the S&P 500 has been down 5% since the start of the year, the recent steam winning sale and for the bottom of the shares in a correction as the market approaches the day when Trump said he was planning to take even more prices on American business partners.
The dive shows how much Trump has surprised the markets since returning to the White House, and not in the right direction. Even if he campaigned to mark trade agreements that would take America, investors are clearly shocked to see how far he left.
What started as Trump’s predictions in relation to the Fed in the middle of pricing forecasts to feed a slight rebound in inflation, has become Trump against the market.
The White House has telegraphed its position by indicating as much. While Trump was known during his first mandate for the use of the stock market as a gauge for his presidency, his team reported that she did not care about the drop in stock prices for the moment.
The Treasury Secretary, Scott Bessent, said that the administration is not worried about volatility, while Trump insists that prices will be an economic windfall. Instead, the president seems to focus his attention on the yield of the US treasure at 10 years to reduce loan costs.
From now on, Wall Street forecasters and investors reduce their expectations for this year.
The latest survey on the feelings of AAII investors shows that 52% of investors said they felt in the stock market in the next six months, double the historical average of 31%. The index of fear and greed of CNN is at levels of “extreme fear”, deepening its descent from a week ago and plunging a year ago when it hovered around the territory “of extreme greed”.
Fund managers have also sold shares at a record rate in recent weeks, according to a Bank of America survey carried out between March 7 and 13, investors have now positioned 23% under the American market, the lowest since last June.
World Research of the Bank of America
Meanwhile, analysts of the largest banks adjust their downward perspectives.
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Goldman Sachs was the first big bank to retreat to his stock forecasts, the strategists reducing their objective for the S&P 500 to 6,200 to 6,500 in early March.
He then reduced his prospects again for the reference index at the beginning of this week, adding in a note that he sees shares drop up to 5% in the next three months and 6% in the next 12 months.
“Strengthest prices, lower economic growth and greater inflation that we previously assumed only the growth forecasts of the S&P 500 EPS to +3 in 2025 ( + 7%) and +%in 2026 (from + 7%)”, said Goldman strategists in a note on Sunday. “We expect a new short-term assessment drop,” they added.
Citi also reduced his vision of actions earlier this month, reducing his note of “overweight” to “neutral” on a lower growth forecast resulting from prices. HSBC made a similar decision, downgrading the American market to “neutral” last week on growth problems.
“The dominant uncertainty around prices could see American actions remain contested in the coming weeks,” wrote the bank in a post last week.
Trump nicknamed on April 2, the day he plans to deploy new prices, the “Liberation Day” for the United States. Win McNamee / Getty images
Others, including RBC, UBS and Barclays, have all reduced their end -of -year forecasts for the reference index. Barclays, which reduced its objective for the S&P 500 last week to 5,900, now holds one of the lowest forecasts of shares this year among the big banks at Wall Street.
“Our basic case assumes that The gains take a hit As prices (the higher prices of China stick but do not degenerate, reciprocal amounts to 5% online) contribute to the slowdown in materials in American activity which nevertheless stops at the pure and simple recession, “the Barclays analysts wrote on Wednesday.
