Stock Market on Jan. 24, 2025: S&P 500 ends below record high as tech slumps, but posts big weekly gain along with Nasdaq and Dow after Trump's return to White House - MarketWatch

Stock Market on Jan. 24, 2025: S&P 500 ends below record high as tech slumps, but posts big weekly gain along with Nasdaq and Dow after Trump's return to White House - MarketWatch


# Stock Market on January 24, 2025: S&P 500 Ends Below Record High as Tech Slumps, But Posts Big Weekly Gain After Trump's Return to White House

The stock market on January 24, 2025, was a day of mixed emotions for investors. The S&P 500 ended slightly below its record high, dragged down by a slump in the technology sector. However, the broader market, including the Nasdaq and Dow Jones Industrial Average, posted significant weekly gains. This surge was largely attributed to the return of former President Donald Trump to the White House, which sparked optimism among investors. Let’s break down the day’s events, the historical context, public opinion, counterarguments, and the implications of this market movement.

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## Historical Background: How We Got Here

- **The Tech Boom and Bust Cycle**: The technology sector has been a driving force in the stock market for decades. From the dot-com bubble of the late 1990s to the rise of FAANG stocks (Facebook, Apple, Amazon, Netflix, Google) in the 2010s, tech has often led market rallies. However, it has also been prone to sharp declines, as seen in 2022 when rising interest rates and regulatory concerns caused a tech sell-off.

- **Trump’s First Presidency and Market Performance**: During Trump’s first term (2017–2021), the stock market experienced significant growth, fueled by tax cuts, deregulation, and pro-business policies. The S&P 500 and Dow Jones hit multiple record highs during this period. However, his presidency was also marked by volatility, particularly during trade wars and the COVID-19 pandemic.

- **Post-Trump Era**: After Trump left office, the market faced challenges such as inflation, geopolitical tensions, and shifting monetary policies. Investors grew cautious, and the tech sector, once a market darling, faced increased scrutiny over valuations and competition.

- **Trump’s Return to the White House**: In 2024, Trump’s unexpected return to the presidency reignited hopes of a pro-business agenda. His promises of tax cuts, deregulation, and infrastructure spending led to a rally in the stock market, particularly in sectors like energy, manufacturing, and finance.

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## General Public Opinion: What People Are Saying

- **Optimism Among Investors**: Many investors are hopeful that Trump’s policies will boost economic growth and corporate profits. The weekly gains in the S&P 500, Nasdaq, and Dow reflect this optimism. Small-cap stocks and industrial sectors have particularly benefited from the renewed focus on domestic manufacturing.

- **Tech Sector Concerns**: While the broader market rallied, the tech sector struggled. Investors are worried about increased regulation, antitrust actions, and the impact of higher interest rates on growth stocks. Companies like Apple, Microsoft, and Tesla saw their shares dip, dragging down the Nasdaq.

- **Mixed Reactions to Trump’s Return**: Some view Trump’s return as a positive for the economy, citing his track record of market-friendly policies. Others are skeptical, pointing to the volatility and unpredictability of his previous term. There’s also concern about how his policies might impact international trade and relations.

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## Counterarguments: The Other Side of the Story

- **Overreliance on Trump’s Policies**: Critics argue that the market’s rally is based on speculation rather than concrete results. They warn that Trump’s policies, such as tax cuts and deregulation, could lead to higher deficits and inflation in the long run.

- **Tech Sector’s Resilience**: While the tech sector slumped on January 24, some analysts believe this is a temporary setback. They argue that tech companies are still fundamentally strong, with robust earnings and innovation driving long-term growth.

- **Global Economic Risks**: The market’s focus on domestic policies may overlook global risks, such as rising tensions with China, supply chain disruptions, and climate change. These factors could weigh on the economy and corporate profits in the future.

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## Implications: What This Means for the Future

- **Short-Term Gains vs. Long-Term Stability**: The market’s weekly gains suggest short-term optimism, but investors should remain cautious. The tech slump highlights the importance of diversification and not putting all your eggs in one basket.

- **Policy Impact on Sectors**: Trump’s policies could create winners and losers in the market. Sectors like energy, manufacturing, and finance may thrive, while tech and green energy companies could face headwinds.

- **Lessons from History**: The market’s reaction to Trump’s return is reminiscent of his first term. Investors should remember that while pro-business policies can boost the market, they can also lead to volatility and uncertainty.

- **The Role of Global Markets**: The U.S. stock market doesn’t operate in a vacuum. Global economic trends, trade policies, and geopolitical events will continue to play a significant role in shaping market performance.

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## Conclusion: A Day of Mixed Signals

January 24, 2025, was a day of contrasts for the stock market. While the S&P 500 ended below its record high due to a tech slump, the broader market posted significant weekly gains, driven by optimism over Trump’s return to the White House. This event serves as a reminder of the market’s complexity and the importance of staying informed and diversified. Whether this rally is sustainable or just a short-term boost remains to be seen, but one thing is clear: the stock market will continue to be a reflection of both economic fundamentals and political developments.

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### Key Takeaways:

- **Tech Sector Struggles**: Slump in tech stocks dragged down the S&P 500.

- **Weekly Gains**: Nasdaq and Dow posted big gains, driven by optimism over Trump’s policies.

- **Mixed Opinions**: Investors are divided on the long-term impact of Trump’s return.

- **Stay Diversified**: The market’s mixed performance highlights the importance of diversification and staying informed.

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