Stocks rebounded but faded due to economic concerns and trade war risk speculation.

From Yahoo Finance: 2025-03-25 13:34:00

Stocks rebounded but faded on speculation of an overextended market due to trade war risks and economic concerns. S&P 500 fluctuated, with Wall Street investors cautious after consumer confidence hit a four-year low. Bond yields slipped, dollar paused, oil fell on Russia-Ukraine ceasefire news, while US copper surged to a record high.

Market forecasters split on equities rebound continuation. HSBC downgraded US stocks to underweight, citing economic concerns, while JPMorgan sees clarity on tariffs reducing risks. Stock market bounce after selloff needs investor conviction of behind us, says Matt Maley at Miller Tabak.

Consumer sentiment surveys reflect fear of inflation resurgence from tariffs, leading to higher prices and less demand. The risk of stagflation and rising recession odds looms as economic concerns and policy uncertainty persist. Until tariff and macro front certainty, sentiment remains vulnerable, says Bret Kenwell at eToro.

UBS Group expects US consumer’s pressure to push stock prices down, with S&P 500 potentially dropping to 5,300 points. Bespoke Investment Group strategists note evidence of wrung out market bullish sentiment, with consumer confidence leading to surges in negative sentiment and possible quick equity market recovery.

Market forecasters debate stock direction post-rebound from 10% drop in February high, as White House signals targeted tariffs approach. Uncertainty remains high, with US levies likely triggering reciprocal responses, making economic consequences unpredictable. Favorable risk/reward less likely at current S&P 500 levels, notes Jonathan Krinsky at BTIG.

Read more: Stock Rally Wanes After Weak Consumer Confidence: Markets Wrap