Tariffs are still higher than before ‘Liberation Day,’ and their impact is inflationary; the Fed is now less likely to cut rates; the average event-driven bear market profile suggests that there may be limited upside for a long time after the rally; and valuations and market concentration concerns remain firmly in place.
History is also not on the side of a further rally. Looking back at 16 other ~20% drawdowns since 1950, the median path from here is gradually lower for the next full year (chart).
