US Stock Market Soars Following Trump’s Announcement of 90-Day Tariff Pause
By Smart Money Mindset Staff
New York, April 10, 2025
In a remarkable turn of events, the US stock market experienced one of its most historic gains after President Donald Trump announced a temporary pause on most tariffs, igniting a wave of optimism among investors. Following the announcement, the S&P 500 surged by 9.5%, marking the third-largest single-day increase since 1940. The Nasdaq Composite soared by 12.2%, while the Dow Jones Industrial Average recorded an astonishing gain of nearly 3,000 points.
Market Reaction to Tariff Pause
On Wednesday, Trump lightened investor anxieties by authorizing a 90-day pause on trade tariffs that had raised concerns about a potential recession. The announcement came as COVID-19 recovery efforts faced challenges, and inflationary pressures persisted. "I have authorized a 90-day PAUSE," Trump stated, recognizing over 75 nations engaged in negotiations who had not retaliated against US tariffs.
Treasury Secretary Scott Bessent confirmed that while the pausing of tariffs would apply to many of the United States’ major trading partners, the 10% tariff on most global imports remains intact. However, tariffs on Chinese products are set to rise dramatically to 125%, raising fears of further volatility in the already tumultuous trade environment.
Wall Street’s Optimism Amid Trade War Tensions
The announcement provided immediate relief to a market that had been skittish amid fears that escalating tariffs could jeopardize economic growth. The S&P 500 was down nearly 19% from its record high set less than two months prior, and professionals had begun to question whether the President would take action to alleviate the financial strain on the stock market.
Wednesday’s gains drew the S&P 500 index closer to escaping the threshold into bear market territory, which is defined as a 20% drop from recent highs. As it stands, the index is down only 11.2% from its peak.
"The trading day started with worry, but it ended with an overwhelming sense of relief," noted a financial analyst. "The market is responding positively to a glimmer of hope in what has been a challenging economic landscape."
Broader Economic Implications
Additionally, the market’s rally was bolstered by a smooth auction of US Treasuries, which had earlier faced volatility due to heightened yields. The yield on the 10-year Treasury fell slightly to 4.34%, though it remains elevated compared to the previous week, adding complications to the overall economic scenario.
Historically, US Treasury yields have decreased in times of market stress, as they are considered a safe haven for investors. However, recent trends indicate that selling pressure from investors needing liquidity has contributed to rising yields. This sharp upward trend in yields can exert pressure on stock valuations and influence mortgage and lending rates for consumers and businesses.
Stocks Surge Across Major Industries
The impressive gains on Wall Street were felt across sectors, with reports indicating that 98% of S&P 500 stocks saw an increase. Airlines led the charge, reflecting renewed confidence in travel as Delta Air Lines jumped by 23.4%, recovering some of the losses incurred in the previous weeks due to trade war fears.
By the end of the trading day, the S&P 500 had climbed 474.13 points to close at 5,456.90, the Dow Jones Industrial Average soared 2,962.86 points to reach 40,608.45, and the Nasdaq composite rose by 1,857.06 points, closing at 17,124.97. ## Global Market Reactions
While US markets celebrated their gains, other global markets reacted differently. Major European indices, including London’s FTSE 100 and France’s CAC 40, fell sharply following the announcement. In contrast, there was a slight rise in Chinese markets, possibly reflecting a more complex response to ongoing trade tensions.
In conclusion, while the pause on tariffs provided a significant boost to US stock prices, the underlying trade issues remain unresolved, with China escalating its counter-tariff measures. Analysts suggest that investors remain vigilant as continued volatility in the markets could lead to further swings in stock performance.
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