Trump Claims US Stock Market at Historical Highs
US President Donald Trump has recently referred to the stock market as "hitting new highs almost every day," stating that even with rising oil prices due to conflicts in Iran, the stock market will continue to rise. However, this statement does not align with current levels: the S&P 500 recently closed at 7673.52 points, approximately 1.61% lower than the record closing of 7798.99 points on August 13.
On Tuesday, all three major indices fell. The S&P 500 dropped 45.08 points or 0.58%, marking the largest single-day point drop and percentage decline since September 1; the Dow Jones fell 628.18 points or 1.2%, closing at 52786.07 points; the Nasdaq fell 0.3%, closing at 26421.41 points. Brent crude oil briefly approached $99.50, as Middle Eastern conflicts and US-Canada trade tensions suppressed risk appetite.
From a longer perspective, the S&P 500 remains significantly higher than the starting point of this administration: up about 32.7% from the closing of 5782.76 points on the election day of November 5, 2024, and up about 28.0% from 5996.66 points on the inauguration day of January 20, 2025, with an annual increase of about 12.1%. According to Bank of America, the S&P 500 has returned approximately 36% including dividends since the election until September 2. The Dow first closed above 54000 points in early August, and the S&P also returned to record territory in August.
Trump uses stock indices as a report card for his administration. On Sunday, he shared an AI-generated image, claiming to have earned "hundreds of billions" on stocks and other holdings "for America, not himself," showcasing Intel's rise from $20 to $95; government-related holdings indicate that the US holds about 9.9% of Intel shares purchased at around $20.47. After non-farm payrolls added 162,000 jobs, exceeding expectations, the stock market fell, and he stated that "success will not lead to inflation," calling for the Federal Reserve to lower interest rates.
Key inflation data will be released before next week's interest rate meeting. The yield on the 10-year US Treasury rose to about 4.82% this week. The market is switching between a "slow bull supported by earnings" and "oil price-inflation-interest rate repricing," with the President's verbal "historical highs" corresponding to the peak memory of August, not the closing on September 8.
Mechanically, this is a struggle between political narrative and pricing. The President uses high-point rhetoric to maintain the legitimacy of risk assets; traders are reassessing the probability of rate cuts based on oil prices and stronger-than-expected employment data. Beneficiaries include long-term funds still holding US stock beta and technology stocks that have already realized record gains; those under pressure include short-term traders leveraging on "daily new highs" and bonds fearing stagflation. Funds did not automatically flow back due to a verbal high point; Tuesday saw a reduction in positions rather than chasing highs.
Source: Public Information
ABAB AI Insight
Trump has used the three major indices as a report card during both of his terms: in his first term, the S&P's total return ranked among the top four-year terms since 1980, while his second term experienced a nearly 20% pullback after tariffs in 2025 before returning to record territory. He simultaneously uses Truth Social and AI-generated images to depict the gains of individual stocks like Intel and Dell as "operating for the country," merging personal expression, government holdings, and index fluctuations into the same narrative.
The capital path follows a cycle of "policy shock—pullback—new highs." Tariffs and Middle Eastern conflicts create volatility, while expectations of tax cuts, corporate profit margins, and rate cut imaginations provide recovery. The government's stake in Intel transforms industrial policy into a balance sheet position, and the President then frames the stock price trajectory as national gains. The motivation is to convert the high points of the capital market into political authorization while pressuring the Federal Reserve to lower rates to "the lowest in the world."
This analogy is not just a typical presidential endorsement of a bull market, but rather a binding of the stock market to votes reminiscent of the Nixon era, as well as the targeted tweets during the pandemic in 2020. A new variable in 2026 is the official holdings entering the narrative alongside generative images. In terms of industry positioning, the US stock market is in a high-level consolidation near record levels: expansion relies on profits, and control disputes occur between the White House, the Federal Reserve, and oil prices.
Structural judgment indicates a transfer of pricing power. The social interpretation of index levels shifts from exchange closing prices to political statements; the interpretation of interest rate paths shifts from employment and inflation data to the slogan "growth is not inflation." The mechanism is: when the President describes "historical highs" as a daily fact, short-term funds must simultaneously trade the impacts of oil prices and verbal interventions, with volatility arising from the misalignment of narrative and quotes, rather than the disappearance of quotes themselves.
ABAB News · Cognitive Law
- Verbal highs do not equal closing highs.
- Treating indices as report cards means accepting the political bill of pullbacks.
- Policy can explain bull markets but cannot explain Tuesday's sell-off.