stock market rally is wobbling as it confronts a horde of challenges to the momentum that's taken it from record high to record high.
A rout early last month was a glimpse of how quickly things can turn bad, a sharp selloff driven by US recession fears that rocked investors used to going in only one direction. While the S&P 500 subsequently rebounded, crucially it didn't made back all the ground lost.
Then, US data Friday showing weaker payrolls growth reinforced the view that the labour market is cooling and sent stocks reeling. The S&P 500 fell 4.25% last week, while the Nasdaq 100 lost the most since November 2022.
Worries about the US are just one of the cracks. There's also concern about growth in China and Germany, and the implications of that weakness on earnings and prices. That's making the way forward look more volatile, even as the foggy rate path clears up and investors count down the days to the first Federal Reserve interest-rate cut in four years.
Then there's the US election, turbulence in European politics and the concentration of money in mega-cap tech stocks, all risks that could hurt the bullish sentiment that at times has looked utterly unshakable.
Frothy valuations have also created new vulnerabilities. Many had to chase the rally and bought at expensive levels, meaning they may sell quickly if things start to reverse, and the market could fall harder and deeper before the usual dip buying kicks in. Additionally, the shift in options trading and the forces of systematic investors are