"Is the wolf coming?" Investors have already learned the "Trump model."
Investors have gradually adapted to the "Trump model." After Trump announced a delay in tariffs on Europe and Canada, U.S. stock futures rebounded. Analysts pointed out that the market fluctuates between Trump's threats and rebounds, with speculators expecting the president to make concessions. However, the momentum of the market rebound has weakened, and investors are growing weary of this uncertainty, which may affect market sentiment. Even if an agreement is reached, European stock markets will be impacted
Overnight, U.S. stock futures rebounded after Trump announced the postponement of tariffs on Europe and Canada until July 9.
Jochen Stanzl, Chief Market Analyst at CMC Markets, stated: "The stock market seems to be dancing to Trump's rhythm: first the threats, then the pullback, followed by a rapid rebound, as speculative investors anticipate concessions from the U.S. president. Today reinforced the so-called 'Trump model,' which is increasingly seen as a successful strategy for risk-tolerant investors."
"One thing is starting to worry us a bit, which is that the momentum of the rebound after these sell-offs is gradually weakening," said Frederic Rozier, Portfolio Manager at Mirabaud France. "We can feel that investors are growing weary of this erratic situation, and as the market fluctuates repeatedly over tariff issues, market sentiment may be eroded. What we know for sure is that even if an agreement is reached, European stock markets will pay the price."
Trump's threats have become the "wolf is coming" story for the market.
The market is bottom-fishing, waiting for Trump to backtrack, until "the wolf really comes."
