The "Buffett Index" soared to a record high of 205%, exceeding the levels during the Internet bubble and the 2008 financial crisis
PANews reported on July 3 that the latest data showed that the key indicator for measuring the valuation of US stocks, the "Buffett Index", has soared to 205%, a record high. This value exceeds the levels during the Internet bubble and the 2008 financial crisis, indicating that the market valuation is extremely overvalued. Currently, the total market value of US stocks has exceeded twice the country's GDP.
Although indicators indicate that there may be a market bubble, the market reaction is relatively flat. As of the start of trading in the second half of 2025, the Dow Jones Industrial Average rose 426 points (1%), the S&P 500 was basically flat, and the Nasdaq Composite fell 0.6%. Funds shifted from technology stocks such as Microsoft and Nvidia to medical stocks such as Amgen, Merck, and UnitedHealth, the latter of which rose nearly 3%, and Johnson & Johnson also rose nearly 2%.
The extremely high level of the Buffett indicator indicates that the market may face the risk of correction, and investors and analysts are closely watching the future trend. The next few months will be a critical period to test whether the market can maintain the current high valuation or usher in a correction.
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