Stock Market Soaring: Nasdaq Nearing Record Highs; Predictions Suggest Further Gains to Follow
In a remarkable turn of events, the Nasdaq Composite (^IXIC) is on the verge of entering a bear market and reaching a fresh all-time high within a span of three months (June 2025). This rapid recovery pattern, which has occurred twice in the last decade, has left financial experts and investors intrigued.
The recent surge can be attributed to several factors, including the persistence of AI tailwinds, strong corporate earnings, and favorable economic data such as the unemployment rate and inflation. However, there is a cloud on the horizon: the uncertainty surrounding the tariff situation, with Fed Chair Jerome Powell expressing concerns about its potential impact on the U.S. economy.
Looking back at history, the Nasdaq has shown a propensity for quick recoveries after bear markets. Notable instances include the late 2018 bear market and quick recovery (about 4 months) and the COVID-19 crash and rapid recovery in 2020 (under 3 months). In 2025, the index saw a similarly swift recovery in about two months.
In late 2018, the Nasdaq fell into a bear market due to concerns about rising interest rates, potential economic slowdown, and U.S.-China trade tensions. It bottomed on December 24, 2018, and recovered to a new all-time closing high of 8,120.82 by April 23, 2019 — just four months after the bottom. The index continued to rally, gaining about 23% over the following 10 months before the pandemic sell-off began.
The COVID-19 pandemic caused another significant downturn in February-March 2020, with the Nasdaq plunging and bottoming on March 23, 2020. Driven by federal stimulus packages and strong tech demand during the pandemic, it surged to a new all-time high by June 6, 2020, at 9,924.75 — approximately 2.5 months after the bottom. The index then continued a strong bull run, eventually peaking at 16,057.44 on November 19, 2021, adding 62% over the next 17 months.
The 2025 bear market was triggered by a sudden imposition of 145% tariffs on Chinese goods in April 2025. This downturn was reversed within eight weeks, with the index climbing back toward all-time highs by June 2025. The recovery pace paralleled the 2020 rebound and was supported by easing trade tensions, favorable Federal Reserve policy expectations, and strong corporate earnings in AI-related tech sectors.
Some economists and analysts believe that the impact of the new tariffs that are already in effect hasn't fully shown up yet. If the tariff situation doesn't derail the economy in the near term, there are good reasons to believe the Nasdaq can keep climbing in 2025.
As of Thursday, the Nasdaq Composite closed at 20,167.91, just shy of the peak it set in December. If it gains another 0.2% and sets a new all-time high, this bear market could end in less than three months, which is unusually rapid.
[1] Data source: Yahoo Finance [2] Definition of a bear market: A decline of 20% or more from the market's recent peak.
- Given the Nasdaq's history of swift recoveries after bear markets, an increase of just 0.2% could propel it to a new all-time high, demonstrating the potential for immediate success in finance and investing, especially in the stock-market.
- The recent tariffs have raised concerns among financial experts, yet the Nasdaq's recovery pace has been quick in the past, such as the 2020 rebound after the COVID-19 crash and the 2025 recovery paralleling the former.
- Uncertainty surrounding tariffs may imply risks for both money management and the overall economy, but the Nasdaq's capacity to rise within a span of three months, as demonstrated in June 2025, demonstrates that there are still opportunities for investing in finance.
