US market declines while global markets thrive

In 2025, the US financial markets are struggling. The dollar has dropped over 4% in value, and major stock indices have also fallen. The S&P 500 is down 4%, while the Nasdaq composite, known for its tech stocks, has seen an 8% decline. This downturn is worsened for big companies like Tesla, Apple, and Alphabet, which have experienced double-digit drops. It's important to note that this is not a global trend. Other markets are performing better. For instance, the MSCI China index is up by 20%, while Europe and the UK have seen gains of 14% and 10%, respectively. Japan and Gulf Cooperation Council (GCC) nations are also on the rise. Wall Street experts were optimistic about US stocks and the dollar. They believed that "America First" policies would strengthen the US economy. However, current market conditions suggest otherwise. The US's economic policies are impacting the global scene, prompting responses from other countries like Germany and China. Germany is increasing public spending, while China is addressing US tariffs and boosting its growth agenda. US investors are concerned about future growth. Recent consumer confidence surveys indicate a significant decline in sentiment. Also, discussions around reducing government spending could lead to economic slowdown. Despite these worries, some economic indicators show resilience and a healthy job market. The inflation reports from February surprised on the positive side, showing slower-than-expected growth in consumer and producer prices. Treasury yields have not dropped as sharply as they often do during recessions, suggesting stability. Currently, the market correction seems typical for highly valued segments. The writer sees no signs of an impending recession and remains neutral about stock allocations while increasing US investments. Long-term investors are advised to avoid drastic changes in their strategies despite market fluctuations.