U.S. Stock Market Value Doubles to $63.8 Trillion in Five Years

The U.S. stock market has reached a significant milestone, surpassing $63.8 trillion in public equity value, according to Goldman Sachs. This figure represents a doubling of the market's size from five years ago, when it stood at around $31 trillion. Notably, the previous doubling took eight years, highlighting the accelerated growth rate in recent times. This surge positions the U.S. market as over three times larger than Europe’s and bigger than the combined market sizes of Europe, China, Japan, and India.

The recent jump in total market size is attributed to a strong finish to the quarter. On Monday, the S&P 500 closed at another all-time high after gaining 0.52%. The Nasdaq Composite, driven by tech stocks, added 0.47%, also hitting a record. The Dow Jones Industrial Average rose 275.50 points, or 0.63%, pulling the entire equities space higher. However, when trading opened Tuesday, futures pulled back. The Dow dropped 32 points, or 0.07%, while S&P 500 futures fell 0.15% and Nasdaq 100 futures slid 0.22%.

On the policy side, tensions arose between Washington and Ottawa early this week. Canada reversed its digital services tax in an effort to ease trade talks with the U.S. This decision came days after President Donald Trump said he would be “terminating ALL discussions on Trade with Canada.” The Canadian government made the decision to pull back on the levy to keep talks from collapsing entirely. Trump’s 90-day tariff reprieve is running out next week, and traders are watching closely for any sign of what comes next.

Markets are still recovering from April, when Trump’s sweeping tariffs knocked the S&P 500 close to bear market territory. Since then, the rebound has been aggressive. The broad market index posted a 10.6% gain for the second quarter, while the Nasdaq jumped nearly 18% in the same period. Despite the pullback in futures, many traders believe momentum could carry into the second half of the year. Mike Wilson, the chief U.S. equity strategist and CIO at Morgan Stanley, believes this is going to be a broader recovery. He pointed to manufacturing and housing as the sectors that could benefit the most from a potential Fed pivot.

Goldman Sachs now expects the Federal Reserve to start cutting rates in September, moving up its forecast from December. David Mericle, the firm’s chief U.S. economist, wrote in a note that “the very early evidence suggests that the tariff effects look a bit smaller than we expected, other disinflationary forces have been stronger, and we suspect that the Fed leadership shares our view that tariffs will only have a one-time price level effect.” Even with inflation looking tamer, Mericle said it’s now harder for people to find jobs. He wrote, “Both residual seasonality and immigration policy changes pose near-term downside risk to payrolls.”

Goldman is now predicting three rate cuts this year—September, October, and December—each by 25 basis points. That would push the Fed’s target range down to 3%–3.25%, from the earlier prediction of 3.5%–3.75%. The bank is also projecting two more cuts in 2026. For now, the Fed’s target range stands at 4.25% to 4.5%. Traders are closely watching the upcoming reports for hints on how the economy is holding up. That includes the S&P Global PMI at 9:45 a.m. ET, followed by the ISM manufacturing report at 10 a.m. The Job Openings and Labor Turnover Survey (JOLTS) is also set to release Tuesday morning. All three reports are expected to influence market expectations around hiring and production.