According to Shenchao TechFlow news on December 25, as reported by Jinshi, numerous market indicators suggest that Trump's new term will face a U.S. stock market at historically high valuations. Data shows that the proportion of household stock allocation in the U.S. has risen from 48.3% at the beginning of 2024 to 51.8%. This metric has the most significant four-year return forecasting ability since 1952, and current data suggests that the actual annualized return of U.S. stocks from 2025 to 2029 may be -1.5%.
Although the household stock allocation reached a historical high during the 2020 inauguration, the S&P 500 index still achieved an inflation-adjusted annual return of 9.3% (above the average level of 7.2% since 1952), but the current market conditions have changed significantly. Multiple valuation metrics are now at high levels exceeding 90% relative to historical distribution positions since 1950, 1970, and 2000, with some even reaching extreme values of 100%, indicating that U.S. stock returns over the next four years may only keep pace with inflation. Trump will face significant challenges if he wants to maintain his tradition of using stock market performance as a political achievement.