Ten indicators revealed, can the rebound in US stocks continue?

Just three weeks ago, the benchmark index for the US stock market, the S&P 500 (S&P 500), even reached a record high. However, individual and institutional investors in the current US stock market re-examined their portfolios and found that the outlook was very different. On Tuesday, the S&P 500 officially entered the so-called “correction” (correction) range — a cumulative decline of 10% from its highest point in less than a month. Although the index rebounded at the close of trading yesterday and is temporarily out of the pullback zone, the entire US stock market is still overcast. The future trend can be described as full of suspense. The forecast rate, which has always been accurate, may help investors determine future market trends.

A series of external tariff policies recently announced by Trump, who has returned to the US presidency to begin his second term, have severely dampened the US business and consumer confidence index, and made global institutional and individual investors more cautious about investing in the US market. Since the new US administration led by Trump fully focused on the external tariff policy in February, more and more global capital has fled the US stock market.

The market has been eagerly awaiting the so-called “Trump Put Options” to boost the US stock market, which has been weak since this year, but Trump and US Treasury Secretary Bessent recently did not reveal any support or appeasement positions for the US stock market. Instead, they emphasized that as the US economy gets rid of its dependence on government spending, the US economy may inevitably go through a period of “detox.”

Trump himself did not directly deny the possibility that the US is in deep recession, and stated that the US economy will have a “transition period” and that tariffs will inevitably cause “disturbances”, stressing that tariffs are intended to make America rich and strong again and “make America great again.” On Tuesday, Trump once again downplayed market concerns about the US recession and did not expect the US to fall into recession. He said at the White House, “I can't see a recession at all. I think the country will prosper.” Trump also added, “You can't keep an eye on the stock market; the stock market will rise and fall. But did you know we have to rebuild our country?”

Market outlook analysis: A list of “ten indicators” with accurate predictions guides the future trend of the S&P 500 index

How to predict the future trend of US stocks? How to accurately implement the “buy on dips” strategy? Below is a “10-point checklist” (10-point checklist) compiled by the investment agency Wall Street Analyst Report. Investors can track future market trends through this list. If more “❌” (negative factors) or “❔” (uncertainties) change to “✅” (positive factors), the market will quickly begin a “big rebound”. Historical data shows that the “comprehensive guidelines” shown by these indicators are very accurate for future bull/bear trends in the market.

Economic growth and recession risk ❌ (negative)

Unpredictable trade policies ❌ (negative)

Government spending cuts ❌ (negative)

Interest rate cut expectations ❔ (uncertain)

Inflation falls back ❔ (uncertain)

Relaxed regulatory environment ❔ (uncertain)

Tax relief measures ❔ (not sure)

Corporate Profitability and Investment ✅ (positive)

Consumer spending is steady ✅ (positive)

Low unemployment rate ✅ (positive)

Conversely, if uncertainties continue to dominate the market, the overall volatility of the US stock market and even the global stock market is likely to increase further. If more negative factors continue to appear, the market may also face greater pain, that is, if more “❌” appears on this forecast list, it may cause additional market sell-off pain.

Investors can pay close attention to the latest market news and economic data, such as the US Consumer Price Index (CPI) data report released at 8:30 a.m. EST on Wednesday. Furthermore, investors should note that this “list of ten indicators” itself also contains some seemingly contradictory “paradoxes”, such as government spending issues. Continued increases in government spending are positive for business and GDP growth in the short term; however, in terms of long-term investment, this may increase the US government's unsustainable debt burden, leading to the US government's “sovereign debt default” — although the latter is difficult to measure in the short term, may be just as important.

I have to admit that Trump's tariff policy has had a very negative impact on short-term sentiment

The Trump administration is trying to implement long-term changes at the structural level of the US economy. Imposing external tariffs to push manufacturing back to the US is the core element of the change. Although the Trump administration's transformation goals are still being debated, there is no doubt that this has had a serious negative impact on the animal spirits (animal spirits) that have supported the market since November of last year, and has led to capital flight from US stocks and beginning to flow to Chinese and European stock markets with valuation and fundamental advantages.

President Trump told the media before the business round table on Tuesday: “The market always rises and falls, but did you know? We have to rebuild our country.” Additionally, White House press secretary Caroline Leavitt (Karoline Leavitt) also added at the press conference: “Whether today, yesterday, or tomorrow, the stock market numbers we see are just a snapshot of a specific point in time. We are at a critical stage of economic transformation and are moving towards a golden age of American manufacturing driven by the 'return of manufacturing to the US' policy.”

In-depth analysis: What does the “list of ten indicators” mean?

According to the Wall Street Analyst Research Institute, the agency will become the so-called “Ten Index List”, which is essentially a set of analytical tools to help investors objectively evaluate changes in the current market environment and trends. The indicators in the list include aspects such as macroeconomic fundamentals (such as economic growth, unemployment rate), policy environment (trade policy, government expenditure, tax and regulatory policies), monetary policy (interest rate, inflation), and business conditions (profitability, investment and consumption expenditure).

Through this list, investors can clearly judge the weight of favorable and negative factors currently facing the market, so as to more accurately predict possible future market trends. Some of these factors may be significant in the short term, while others have more long-term significance. Investors need to balance short-term fluctuations with long-term structural shifts to develop more effective investment strategies.

In summary, this forecast list, which includes “ten indicators,” is like a “barometer” for predicting whether the overall market is bullish or bearish, to help investors clarify whether the future of the market will continue to fluctuate downward or rapidly resume upward momentum.

On March 11, analysts David J. Kostin, Ben Snider, and others from the Wall Street bank Goldman Sachs released the latest research report, lowering the year-end target for the S&P 500 index from 6,500 points to 6,200 points. However, the Goldman Sachs analysis team said that if the US economy and earnings continue to grow, historical data shows that a pullback in the S&P 500 index is usually a good opportunity to buy on dips.

Over the past three weeks, the S&P 500 index once fell more than 10% from its all-time high, and more than half of the decline was due to the overall sharp decline of 15% of the “Big Seven” of US stocks, including Nvidia, Microsoft, and Tesla. Last year, the “Big Seven” contributed up to 25% of the total return of the S&P 500 index.

Goldman Sachs believes that for the market to recover, it is necessary to meet at least one of the following three conditions for a sustained rebound. These conditions are basically consistent with the “unmet situation” implied by the so-called “ten indicators” list: First, the outlook for US economic activity needs to be significantly improved, which may stem from better economic growth data or essential changes in tariff policies; second, stock valuations or pricing between cyclical stocks and defensive stocks are already far below Goldman Sachs' basic predictions; third, investor positions are already low.