Donald Trump’s election was greeted euphorically by markets, but the Trump bump is over.
This is evident in the divergence in global stock prices. The S&P 500 has treaded water in 2025, even as the Euro Stoxx 600 (up 9 per cent) and Chinese technology stocks (MSCI’s China Tech 100 index is up 27 per cent) have raced higher.
The change in mood is also evident in US consumer confidence, which sank in February by the most since August 2021.
And it’s evident in stock market sentiment. CNN’s Fear & Greed index is now in extreme fear territory and close to its lowest level over the past year.
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Sentiment among ordinary investors, too, has plunged, with the latest American Association of Individual Investors (AAII) poll showing just 19 per cent are bullish – the lowest level since March 2023, notes Bespoke Investment, when Silicon Valley Bank and other smaller banks collapsed.
Even more dramatically, bearishness spiked to over 60 per cent. That’s one of the highest readings in history, exceeded only in times of crisis (specifically, the 1990 recession and Iraq’s invasion of Kuwait; at the height of the financial crisis in 2009; and near September 2022’s bear market lows).
Usually, investors only get this freaked out when stocks have plunged – not when the S&P 500 is within 3 per cent of all-time highs, as it is today.
