The New York stock market, which experienced a panic-like correction last month, rebounded. U.S. President Donald Trump eased tariffs on China, causing the market to rapidly breathe a sigh of relief, and the Standard & Poor's (S&P) 500 index rose by about $8 trillion based on market capitalization since the low on the 8th of last month. This level has compensated for this year's losses, marking the fastest recovery since 1982.
According to CNN on the 15th (local time), this rally was led by technology stocks. Shares of Apple and Amazon rose by more than 20% each, and NVIDIA increased by over 40%, with the broader sectors of consumer goods, industrials, telecommunications, and finance also seeing a rebound. Investor sentiment showed a dramatic turnaround. The market sentiment indicator, which once indicated 'extreme fear,' has recently revived to 'greed,' CNN analyzed.
The background of the market recovery was influenced by the tariff adjustments of the Trump administration. Exemptions from tariffs on smartphones and some electronic products provided a boost to the technology sector, and investors judged that concerns over an economic downturn had eased. JPMorgan has lowered the probability of a U.S. recession to below 50%, while Goldman Sachs has decreased its estimate from 45% to 35%.
However, skepticism persists regarding whether the rebound can be sustained. Global financial group UBS cited the possibility of weakening economic indicators and lowered its U.S. stock investment outlook from 'attractive' to 'neutral.' Research firms CFRA and Nationwide have diagnosed that the current market has entered an overbought state.
The average effective tariff rate in the U.S. remains at 17.8%, the highest level since 1934. Although some tariffs on China have been reduced, they still reach 30%, putting pressure on supply chains and prices.
CFRA noted that two-thirds of past bear markets were followed by further declines after short-term rebounds. More than anything, the core of uncertainty lies in President Trump's erratic trade policies. Investors believe that even a single post on social media (SNS) could shake the market again.
Sam Stovall, Chief Investment Strategist at CFRA, said, 'This rebound is merely an artificial correction, and if the President changes direction again, another shock could occur.'