**Turmoil in Global Markets: Trump’s Tariff Decision Drives Stock Rebound**
The US stock market experienced a dramatic turn-around on Wednesday as President Donald Trump announced a 90-day pause on most countries’ tariffs, while increasing levies on China. The S&P 500 surged nearly 8%, while the tech-heavy Nasdaq Composite rose a remarkable 10%, marking one of its biggest gains since 2008. The Dow Jones Industrial Average rallied over 7%, gaining more than 2,500 points.
This decision comes after China retaliated with an 84% tariff on US goods, escalating the trade war. Despite this, stocks rebounded significantly, with Big Tech leading the charge. Nvidia and Tesla saw increases of over 15% and 17%, respectively. The rally has revitalized investor confidence, following a tumultuous week where major indexes faced steep declines due to tariff concerns.
However, economists remain cautious. Former Treasury Secretary Larry Summers warned that the US economy is still at risk, despite the market relief. Goldman Sachs initially predicted a recession but later revised its stance following Trump’s announcement. The banking sector also voiced concerns, with JPMorgan’s CEO Jamie Dimon indicating a US recession is now a likely outcome.
The market volatility has been exacerbated by rising Treasury yields, which climbed to 4.4%, reflecting ongoing economic uncertainty. In contrast, gold futures rose but then pared gains as stocks soared. The US dollar remained flat despite the tariff news.
Tech stocks, particularly chipmakers, were among the top performers, with significant increases in Nvidia, Broadcom, AMD, and Intel shares. The broader sectoral performance was also positive, with Big Tech leading the gains.
For stock traders and financial market investors, this rapid market swing underscores the sensitivity of the economy to geopolitical and trade-related announcements. The pause in tariffs could offer a temporary reprieve but does not eliminate the long-term risks associated with ongoing trade tensions. As earnings season approaches, investors will closely watch how corporations navigate these challenges and how it impacts their bottom line.
Overall, while the short-term market reaction has been positive, investors remain alert to future economic developments and the lasting impact of trade policies on global markets.
