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Feb 28 - Bank of America strategists warned that a reversal of the S&P 500's post-election rally could spur policy measures by President Donald Trump to buoy the market.
The benchmark index has slid nearly 3% this month as concerns grow that Trump's proposed tariffs may ignite a global trade war. The decline erased much of the rally gained after the November 5 presidential election, leaving the index roughly 1% above its closing level of 5,783 points on that day. The data indicates that about half of the index's constituents have lost ground since election day.
Market investors are actively watching for government intervention while market sentiment changes. The analysts highlight lower interest rates and tax cuts as the strongest potential stock market stabilization tools that may arise in case the market slump deepens.
The market approaches decisions with caution because trade tensions keep rising alongside numerous economic uncertainties. The recent policy adjustment has generated increased attention to measuring its policy effects while investors and market players need clarifications from the White House about stability strategies for stock market retention.
This article first appeared on GuruFocus.