Is the Bull Market Over? — A Finance World Commentary

November 18, 2025 Finance World Commentary 0

Over the past few years, equity markets have staged an impressive rebound: robust gains, AI-driven optimism, and resilient corporate earnings have fueled what many call a new bull run. But as we move deeper into 2025, the question increasingly on investors’ minds is: Is the bull market over?

Short answer: Not necessarily — but it’s far from a straight sprint upward. The picture is nuanced.

1. The Bull Isn’t Dead — Just Getting More Cautious

  • Morgan Stanley argues that the bull market may not be finished. Their Applied Equity Advisors team notes that recent volatility has washed out much of the euphoria that was building, potentially setting the stage for further gains.
  • That said, they expect more muted returns. After two strong years, the upside for 2025 may be more modest.
  • Franklin Templeton goes even further: in their view, U.S. equities may be entering their “prime.” They argue that current conditions — resilient earnings, solid macro backdrop, and a broadening rally — support continued strength.
  • Historically, bull markets don’t always blow up quickly. According to The Motley Fool, past S&P 500 bull runs have often lasted years.

2. But There Are Legit Risks

While the bull case remains alive, there are several warning flags:

  • Geopolitical and Policy Risk: Morgan Stanley’s wealth management team warns of geopolitical tension, legislative uncertainty (e.g., around tax bills, bank regulation), and tariff shocks. 
  • Earnings & Capex Fragility: Though earnings have held up, capital spending may be weakening, and CEO confidence is under pressure.
  • Valuation Stretch: Some valuation metrics point to froth; investors should be wary of overpaying into euphoria.
  • Economy Slowdown Risk: According to Stifel (via Kiplinger), real GDP could decelerate later in 2025. Sticky inflation could derail rate-cut expectations, leading to a potential 10–15% correction in the S&P 500.

3. Sentiment Is Turning Bearish — But That Could Be a Contrarian Signal

  • According to a Barron’s “Big Money” poll, professional investors are more bearish than they’ve been in nearly 30 years — only 26% identify as bullish, while 32% are bearish.
  • That’s interesting because extreme pessimism from pros sometimes offers a contrarian buying signal. If sentiment is washed out, it can lay the foundation for a renewed leg up — provided the fundamentals hold.

4. Melt-Up or Bubble? Some Think We’re in One

  • Ed Yardeni (Yardeni Research) argues we may already be in a “melt-up” — a speculative surge driven by optimism, not necessarily fundamentals. 
  • That bears similarity to past bubble dynamics, particularly given the central role of AI in driving market exuberance. If the melt-up continues, it could inflate valuations further, but if it reverses, the downside risks would be significant.

5. The Base Case: More Range, More Volatility

Putting it all together, a reasonable base-case scenario for Finance World to highlight is:

  • The bull market is not over, but the easy gains may be behind us.
  • Expect a choppier market: pullbacks, corrections, and volatility may become more frequent.
  • Potential catalysts for continued gains: AI productivity, Fed rate cuts, and growth-friendly policy.
  • Key risks to watch: tariffs, policy missteps, and overvaluation.
  • For investors: active positioning may make sense — quality names, diversified exposure, and some hedge / defensive plays.

6. Strategic Implications for Investors

  • Long-term Investors: Use weak spots as potential entry points. If you believe in the structural story (AI, productivity, innovation), selectively layering into sectors could pay off.
  • Risk-aware Allocators: Don’t ignore diversification. Consider adding bonds, commodities, or international exposures to mitigate risk.
  • Tactical Traders: Be nimble. With potential for greater volatility, shorter-term trades might work — but stay disciplined on risk.
  • Stay Informed: Monitor macro data (inflation, GDP), Fed signals, trade developments, and corporate earnings.

7. Bottom Line

Is the bull market over? The short answer: No — but it’s no longer a race uphill. What we may be heading into is a more mature, more nuanced phase of the bull: slower gains, more risks, and more room for both growth and pain.

For Finance World, the narrative isn’t “bull is dead,” but rather “bull is evolving.” As markets transition, investors who stay smart — balancing optimism with discipline — are likely to navigate this chapter the best.