Recent volatility in the stock market has led to significant fluctuations, with major indexes like the S&P 500 experiencing a 10.5% decline over two days followed by a remarkable 9.52% increase in a single session.

This instability has been exacerbated by a 10% global tariff introduced on April 2, 2025, and a subsequent 90-day pause on reciprocal tariffs announced on April 9, 2025, which notably excludes China.

The uncertainty among investors has largely been attributed to President Donald Trump's tariff policies, which have contributed to the market's erratic behavior.

Additionally, rising Treasury bond yields are raising concerns as they could hinder borrowing and slow economic growth, while tariffs may further exacerbate inflation.

The S&P 500's Shiller price-to-earnings ratio has reached historically high levels, suggesting potential declines in market value, particularly when the ratio exceeds 30.

Interestingly, the S&P 500 recently experienced a significant event that has occurred only 24 times in the past 75 years, boasting a historical success rate of 91% in predicting future stock movements.

In previous instances of similar significant single-day gains, the S&P 500 was higher 91% of the time over the following year, with an average increase of 26.9% during that period.

However, investors are cautioned that while such gains can be promising, there are no guarantees, and the market may still experience corrections or downturns in the interim.

Despite the recent sharp gains, historical data indicates that after a 5% increase in the S&P 500, the index has declined 65% of the time the following day, and only 39% of the time has it continued to rise one week later.