The US stock market experienced a historic rally on Wednesday after President Donald Trump announced a 90-day pause on some tariffs. The Dow soared 2,963 points, or 7.87%, the S&P 500 shot up 9.52%, and the Nasdaq climbed 12.16%. This marked the best day for the S&P 500 since October 2008 and the third-best day in the index’s history since 1957.
Nearly every company in the S&P 500 saw gains, with notable performers including Amazon, up 11.98%; Nike, up 11.36%; United Airlines, up 26.14%; Delta Air Lines, up 23.38%; and American Airlines, up 22.6%. On the Nasdaq, Apple surged 15.33%; Nvidia rose 18.72%; Palantir gained 19%; and Tesla jumped 22.69%. Chris Brigati, chief investment officer at SWBC in San Antonio, Texas, said, “The market’s move upward is violent, and speaks to how badly the market was looking for clarity on this issue.”
Before this upward swing, the S&P 500 had been nearing bear market territory, close to a 20% drop from its all-time high seven weeks ago on February 19.
The index closed down 11.2% from its February peak. Trump’s reversal on tariffs provided a clear indication of his market-focused approach.
Stocks surge amid tariff announcement
He posted on social media advising investors to “BE COOL!” and suggesting “This is a great time to buy!!!”
Earlier in the day, global markets had fallen due to China’s retaliatory measures and the European Union’s countermeasures against Trump’s tariffs. However, markets rebounded after Trump announced a reversion of tariffs to the universal 10% rate for all countries except China, which faces a US tariff of at least 125%. Jamie Cox, managing partner at Harris Financial Group, remarked, “Trump illustrated to everyone in the market today how incredibly difficult it is to trade around his tariff regime, because he and only he knows when it ends.”
Despite these market rallies, bonds acted unexpectedly.
US Treasury yields rose as investors sold off bonds. The benchmark 10-year yield climbed above 4.3% after initially falling below 4%. An analyst from Deutsche Bank noted, “Investors are still trying to navigate the extreme volatility in both the stock and bond markets.
Trump’s decision to pause some tariffs has brought temporary relief, but uncertainties remain.”
As Trump monitors the markets closely, the US dollar index faces fluctuations driven by the ongoing uncertainty of the trade war. This article reflects the broader narrative of fluctuating market conditions amidst international trade tensions and policy shifts, highlighting the complexity and interconnectedness of global economic systems.
