US stocks just wrapped up the first half of 2025 at fresh all-time highs, a far cry from the gloom-and-doom sentiment just three months ago. If you are feeling whiplashed, you are not alone. After tiptoeing dangerously close to a bear market in early April, the S&P 500 has staged a stunning rebound.
Back then, the world was rattled by Trump’s Tariff Turmoil (yes, some people are calling it TTT now) and unease over China’s DeepSeek, which many feared could spell bad news for US tech especially those pouring billions into AI infrastructure. Those worries eased as it became clear President Trump’s aggressive tariff moves were not part of a full-blown economic war. A surge in tariff-induced inflation never took hold, another reason markets found their footing.
How strong was the bounce on the S&P 500? Try more than +20% rally in 12 weeks, one of the sharpest in market history. What about volatility? The VIX did not just cool off. It crashed, plunging more than 60% in what now ranks as the biggest volatility unwind ever recorded.
As with most bull markets, this one is being driven by high-growth names, AI and tech stocks at the forefront powering the indexes higher. Historically, recoveries of this strength tend to be followed by more upside but that does not mean it will be smooth sailing from here.
Hip, hip, hooray! Our risk positions have bounced back strongly, validating the importance of staying disciplined when things get shaky. I remain a bull and have been right on the call.