• Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
Stock

Why Friday’s sell-off in S&P 500 was not surprising and what comes next

by August 3, 2025
by August 3, 2025

US stocks kicked off August with a sharp retreat as the Trump administration announced reciprocal tariffs on several countries – with levies ranging from 10% to 41%.

A disappointing monthly jobs data (July) revealing ongoing labour market weakness added further to investor woes, triggering a notable decline of as much as 2.0% in the benchmark S&P 500 index.

While these headlines rattled financial markets on Friday, the broader picture remains sufficiently positive for investors to not be overly concerned.

In fact, there’re compelling reasons to view this pullback as a healthy pause, perhaps even a buying opportunity for the second half of 2025.

S&P 500 was due for consolidation

Ahead of Friday’s sell-off, the benchmark S&P 500 index was up nearly 27% versus its April low, marking one of its most aggressive rallies in recent history.

Following such rapid gains, a short-term cooldown is not only expected – it’s actually constructive.

Technical analysts note the index had been riding a wave of bullish momentum since spring, and needed time to stabilize before resuming its upward trajectory.

Frank Cappelleri of CappThesis, for example, described the recent surge as “digestive,” suggesting all the benchmark index did on Friday was recalibrate to unlock its “next leg higher”.

Simply put, the aforementioned pullback in the US stocks may have been less about weakness and more about sustainability.

August tends to be weak for the S&P 500 index

Historically, both August and September tend to be sluggish for US stocks. The seasonal weakness is well-documented and reflects investor caution ahead of fall earnings and macro developments.

According to Andrew Thrasher, the founder of Thrasher Analytics, the market had seen very few large daily swings in recent weeks, which can set the stage for volatility when a 1.0% move finally hits.

In a recent note to clients, Ari Wald of Oppenheimer added that internal market breadth had narrowed at the recent peak, with fewer stocks participating in the rally. The setup, combined with seasonal headwinds, makes it unsurprising that the benchmark S&P 500 index experienced a modest retreat on Friday. 

Investors familiar with these patterns know that softness in late summer doesn’t necessarily derail the broader bull case.

Oppenheimer sees S&P 500 soaring to 7,100 level

Despite recent turbulence, Oppenheimer remains bullish on S&P 500’s long-term trajectory.

The investment firm currently has a street-high year-end target of 7,100 on the benchmark index, implying potential upside of another 14% from current levels.

Ari Wald, the head of technical analysis, acknowledged short-term vulnerabilities in small-cap and value stocks in his latest research note but emphasized the strength of large-cap growth names.

He expects seasonal consolidation to continue through the third quarter but views it as a setup for renewed gains.

For investors with a long-term horizon, this reinforces the idea that Friday’s sell-off is more of a pit stop than a detour.

The post Why Friday’s sell-off in S&P 500 was not surprising and what comes next appeared first on Invezz

0 comment
0
FacebookTwitterPinterestEmail

previous post
Retail investors shift focus to Europe as US valuations stretch

Related Posts

Retail investors shift focus to Europe as US...

August 3, 2025

Berkshire Hathaway posts 4% dip in Q2 operating...

August 3, 2025

Bank of America picks 5 stocks with post...

August 3, 2025

Here’s what will affect the Nikkei 225 Index...

August 3, 2025

BYD’s July sales stall, casting doubt on 2025...

August 2, 2025

US stock plunge as jobs data disappoints and...

August 2, 2025

Moderna cuts 2025 revenue to $2.2B after UK...

August 2, 2025

Brazil antitrust watchdog probes Microsoft after Opera complaint...

August 2, 2025

Reddit shares surge 20% on record profit and...

August 2, 2025

OpenAI raises $8.3B as AI demand grows: report

August 2, 2025

Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.

By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

Recent Posts

  • Why Friday’s sell-off in S&P 500 was not surprising and what comes next

    August 3, 2025
  • Retail investors shift focus to Europe as US valuations stretch

    August 3, 2025
  • Berkshire Hathaway posts 4% dip in Q2 operating profit, writes down Kraft Heinz stake

    August 3, 2025
  • Bank of America picks 5 stocks with post earnings rally potential

    August 3, 2025
  • Here’s what will affect the Nikkei 225 Index this week

    August 3, 2025
  • Inside the Biden cover-up probe: 8 aides questioned, more on the way

    August 3, 2025

Editors’ Picks

  • 1

    Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • 2

    Walmart earnings preview: What to expect before Thursday’s opening bell

    February 20, 2025
  • 3

    New FBI leader Kash Patel tapped to run ATF as acting director

    February 23, 2025
  • 4

    Anthropic’s newly released Claude 3.7 Sonnet can ‘think’ as long as the user wants before giving an answer

    February 25, 2025
  • 5

    Nvidia’s investment in SoundHound wasn’t all that significant after all

    March 1, 2025
  • 6

    Cramer reveals a sub-sector of technology that can withstand Trump tariffs

    March 1, 2025
  • 7

    Elon Musk says federal employees must fill out productivity reports or resign

    February 23, 2025

Categories

  • Economy (2,065)
  • Editor's Pick (203)
  • Investing (185)
  • Stock (1,376)
  • About us
  • Contact us
  • Privacy Policy
  • Terms & Conditions

Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Read alsox

Inside candy major Ferrero’s plan to woo...

May 10, 2025

How big is the threat to Visa,...

June 19, 2025

Adobe CEO defends AI strategy, rejects claims...

March 14, 2025