For 3 Years, the Bull Market Defied Inflation, Tariffs and Gravity

In a remarkable display of resilience, the current bull market has celebrated its third anniversary, having weathered a trifecta of challenges that would have felled a lesser market. Born during the Biden administration, this bull run came perilously close to ending in April, only to be revitalized by the artificial intelligence (AI) frenzy that swept through the financial markets.

Despite the ominous backdrop of rising inflation, escalating trade tensions due to tariffs, and what some might consider economic gravity, the market has continued its upward trajectory. The inflationary pressures, which many expected to derail the bull market, were initially concerning. As prices rose, the conventional wisdom suggested that higher inflation would lead to higher interest rates, which in turn would increase borrowing costs and dampen economic growth. Yet, the market seemed to shrug off these concerns.

The trade tensions, marked by the imposition of tariffs, had also threatened to disrupt global supply chains and dampen economic growth. However, in a display of market buoyancy, these challenges were navigated with relative ease. The market’s ability to absorb these shocks can be attributed, in part, to the adaptability and resilience of investors and the underlying economic fundamentals.

The close call in April, when the bull market nearly ran out of steam, marked a critical juncture. It was then that the burgeoning AI sector breathed new life into the market. The excitement around AI and its potential to revolutionize industries captured the imagination of investors, providing a second wind to the bull run. This technological fervor not only provided a boost to related stocks but also helped to reinforce confidence in the market’s overall trajectory.

The AI boom, with its promise of transformative technologies and potential for substantial economic impact, has been a significant factor in the market’s resilience. It represents a paradigm shift in how businesses operate and create value, offering a compelling narrative for investors. This thematic investment trend has not only propped up the market during a period of uncertainty but has also served as a reminder of the market’s capacity to evolve and adapt to new information and trends.

As the market looks to the future, it does so with a cautious optimism. The challenges of inflation, tariffs, and economic gravity have not disappeared, but the market’s ability to navigate these obstacles has been a testament to its underlying strength. The AI-driven momentum, coupled with a resilient economic backdrop, suggests that this bull run may have further to go, even as it continues to defy expectations.