Moz Farooque
5 min read
The stock market appears to be in the middle of a reset, but Bank of America feels investors shouldn’t expect a major rebound just yet.
BofA’s chief investment strategist, Michael Hartnett, argues that the conditions that usually signal the end of a brutal market correction are only partially in place, per reporting from Seeking Alpha.
Hartnett said the current turbulence in the stock market follows a familiar pattern, where we’re seeing corrections led by “exogenous shocks at a time of excess bullishness.”
In other words, markets became incredibly optimistic, only for external events such as the Iran war to rattle investor sentiment, triggering a broad reset.
Here’s how the major stock indices have fared over the past week.
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S&P 500:6,878.88 to 6,740.02, down about 2.0%
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Dow Jones Industrial Average:48,977.92 to 47,501.55, down about 3%
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Nasdaq Composite: 22,668.21 to 22,387.68, down about 1.2%.
Source: Reuters
The S&P 500 was last trading at 6,740.02 on Friday, March 6, 2026, according to the Associated Press, down roughly 1.5% year to date.
For perspective, when I last covered the S&P 500 on March 2, 2026, it closed at 6,881.62; since then, it has fallen 141.60 points, or about 2.1%.
The primary focus on that piece covering Morgan Stanley’s Mike Wilson was “dispersion,” the idea that the S&P 500 can appear stable even as many of the stocks beneath the surface have crashed.
That said, it overlaps with Hartnett’s point that the market’s fundamentalsare undergoing a reset.
Harnett believes a few critical pieces of the reset are now being seen in the current price action.
However, the final piece of the puzzle still hasn’t appeared.
From a historical standpoint, these resets tend to end after safe-haven assets such as oil and the U.S. dollar weaken, but he says the markets have yet to see it come to fruition.
Until that happens, Hartnett argues that investors shouldn’t expect “big trading upside.”
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2020: 3,756.07 year-end close; up 16.3% for the year versus 3,230.78 at the end of 2019
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2021: 4,766.18 year-end close; up 26.9% for the year
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2022: 3,839.50 year-end close; down 19.4% for the year
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2023: 4,769.83 year-end close; up 24.2% for the year
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2024: 5,881.63 year-end close; up 23.3% for the year
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2025: 6,845.50 year-end close; up 16.4% for the year
Source: S&P 500 closing levels via FRED/S&P Dow Jones Indices and YCharts historical data
Hartnett’s thesis on the stock market hinges on a market rotation that develops during corrections.
