Enter the state of "extreme fear"! The bearish market in the US stock market has fully emerged.

Investor panic in the stock market is intensifying, even though the S&P 500 index is still hovering near historical highs. Analysts at Bespoke Investment Group pointed out in a report on Thursday: "What has changed in market sentiment? No matter how you look at it, panic has permeated the collective psyche of investors." The firm listed a number of indicators reflecting the rise in market panic, showing a significant deterioration in investor confidence. This sentiment has spread to various levels, including economic uncertainty indicators. The Economic Policy Uncertainty Index developed by economists Scott Baker, Nick Bloom, and Steven J. Davis has exceeded the levels seen during the height of the COVID-19 pandemic. The previously released University of Michigan Consumer Confidence Index showed a decrease to the lowest level since November 2023 in February, further exacerbating market concerns. And on Tuesday, the Consumer Confidence Index released by the Conference Board in the United States also dropped significantly by 7 points to 98.3, the lowest in eight months, causing further unease among investors. Bespoke analysts pointed out that despite the worsening economic and consumer data, the most obvious panic is still evident in the stock market. In several widely watched market sentiment indicators, CNN's Fear and Greed Index fell to 21 on Thursday morning, indicating an "extreme fear" in the market. The index combines market momentum, market breadth, options trading activity, high-yield bond market, and demand for safe-haven assets. In addition, the weekly Investor Sentiment Survey released by the American Association of Individual Investors (AAII) also shows a significant increase in bearish sentiment. The report stated: "Market 'bears' have fully emerged." The data shows that bullish sentiment plummeted from 29.2% last week to 19.4%, hitting a new low since March 2023. But more importantly, the surge in bearish sentiment is more pronounced. According to AAII data, the proportion of bearish sentiment skyrocketed from 40.5% last week to over 60%, the largest weekly increase since August 2019. Throughout the history of this survey, there have only been six trading weeks with higher bearish sentiment in the market, all of which were associated with major historical events such as: 1990 economic recession; Iraq invading Kuwait (1990); Global financial crisis 2007-09; September 2022 (when the market was in a bear market low). Investors generally believe that extreme panic sentiment usually occurs near market bottoms. As Warren Buffett said, "Be fearful when others are greedy, and greedy when others are fearful." However, the particularity of this round of market panic is that, despite the sharp rise in panic sentiment, as of the close of Wednesday, the S&P 500 index had only fallen by 3.1% from its historical high on February 19. The Bespoke analysts wrote, "Today, investors are more prone to panic than ever before. If one word were to describe the current market sentiment, it would definitely not be 'complacent.'" Although market data performance remains relatively robust, the rapid collapse of investor confidence could further exacerbate market volatility. In the current macro environment, the future direction of the market will depend on whether investor sentiment can stabilize and whether subsequent economic data can provide new support for the market.