Year of the Snake US Stock Market Review: From a $6.6 Trillion Crash to the Rise of the AI "$4 Trillion Club"
With the conclusion of the public holiday on February 16, the Year of the Snake trading for the US stock market will officially come to an end. From January 29, 2025, to February 14, 2026, the Nasdaq rose by a cumulative 14.26% to 22,546.67 points, the S&P 500 increased by 12.66% to 6,836.17 points, and the Dow Jones climbed 10.37% to 49,500.93 points. Although the three major indexes ranked mid-tier among global stock indices, the core narrative of the capital market during the Year of the Snake was the marked internal structural divergence and violent asset price fluctuations.
The US stock market displayed a distinct "technology-traditional" binary landscape: the AI computing chain and gold stocks led the world. The three major memory giants—Western Digital, Micron Technology, and Seagate Technology—soared by 495%, 368%, and 333% respectively, becoming the biggest winners; gold mining stocks Kinross Gold, Newmont, and Barrick Gold all surged over 226%, resonating with the explosive rises in COMEX silver (150.21%) and gold (82.97%). In contrast, among consumer stocks, only Herbalife recorded a 150% increase due to a turning point in its China business, highlighting the market's extreme pursuit of growth.
On April 2, 2025, the Trump administration launched an unexpectedly broad global reciprocal tariff policy, triggering a 10.53% plunge in the S&P 500 over two days, with $6.6 trillion in market value wiped out, while the Nasdaq and Russell 2000 fell into technical bear markets. However, a rapid policy reversal led to an epic rebound: on April 9, the Nasdaq soared 12% in a single day, the S&P jumped nearly 10%, and the Dow Jones surged by 2,900 points. Thereafter, AI giants became the core driving force—Nvidia’s market value successively surpassed $4 trillion and $5 trillion, overtaking the combined stock markets of the UK and France; Apple and Microsoft briefly joined the "4 trillion club," and Oracle, driven by a threefold increase in orders, helped Larry Ellison become the world’s richest man (although the stock later pulled back 40%).
Although AI remained the main theme throughout the year, market concerns over the monopoly power of tech giants continued to grow. At the beginning of 2026, Amazon, Google, Microsoft, and Meta announced a $660 billion capital expenditure plan, sparking a self-defeating "arms race": Amazon fell into a bear market with eight consecutive declines, Google planned to issue a "century bond" for capital injection, Microsoft declined due to a slowdown in its cloud business, and only Meta remained resilient thanks to improved ad ROI. Meanwhile, traditional stocks led by Goldman Sachs and Caterpillar rose against the trend, indicating a shift in capital towards cyclical sectors. The $6.26 billion IPO of medical giant Medline and Walmart’s transfer to the Nasdaq further evidenced the trend toward market diversification.
Looking ahead to 2026, the three major investment banks—Morgan Stanley, JPMorgan Chase, and Goldman Sachs—hold significantly different views. Morgan Stanley is optimistic, projecting the S&P 500 to reach 7,800 points, favoring small-cap, cyclical, financial, and industrial sectors, and believes earnings growth, AI-driven efficiency gains, and policy support will sustain the bull market; JPMorgan Chase predicts a "structural bull market" with K-shaped divergence, sets a target of 7,500 points for the S&P (potentially rising to 8,000 if rate cuts occur), and recommends overweighting TMT, utilities, and defense stocks; Goldman Sachs warns of slowing economic growth in the second half of the year, believes cyclical stocks will outperform in the first half, but sees limited room for a comprehensive rotation.
During the Year of the Snake, the US stock market journeyed from the tariff abyss to an AI frenzy, from the "Magnificent Seven" monopoly to the comeback of traditional stocks, playing out a true song of ice and fire in the capital markets. The surge in gold and silver, along with the decline in oil and the US dollar, further underscores the profound restructuring of global asset allocation. Looking ahead to the Year of the Horse, can AI continue to lead the growth charge? Can traditional industries break out of the "concentration trap"? The tussle between policy and earnings will determine the next turning point for the markets.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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