From Crash to Comeback: Markets Rebound After Trump Tariff Pause
President Donald Trump escalated the U.S.-China trade dispute by imposing a 125% tariff on Chinese imports in response to China’s 84% tariff on U.S. exports.
The policy, effective immediately, seeks to pressure China economically but has shaken global markets.
Also read: Kevin O’Leary Urges 400% Tariffs on China Amid Escalating Trade Tensions
Alongside the new tariff on China, Trump also announced a 90-day pause on tariff hikes for other nations, capping rates at 10% during trade talks and softening the impact elsewhere.
Trump announcement (Source: Truth Social)
A recent poll shows 56% of Americans view the tariffs as excessive, with Trump’s economic approval rating at 43% against 51% disapproval.
The stock markets took an initial hit, with the S&P 500 down 17% since mid-February, erasing $104,000 from the average retirement account. The tariff pause reversed the trend: the S&P 500 climbed 9.5%—its largest single-day gain since World War II—while the Nasdaq rose nearly 10%, its best performance since 2008.
Also read: Presidential Overreach on Trial: NCLA Seeks Judicial Review of China Tariffs
Oil prices also increased, U.S. crude futures increasing over 4% to $62.35 per barrel after dipping as low as $55.12.
Tech and Crypto Recover After Trump Tariff Pause
The tariff escalation has impacted the tech and crypto sectors. Tech stocks rebounded post-pause, with Tesla, Nvidia, and Apple each up over 10% and the VanEck Semiconductor ETF gaining 14%.
Stock market heat map (Source: TradingView)
Retail stocks also jumped, with Wayfair up 20%, Levi Strauss up 18%, and Nike up 10%, as an indication of hope about delayed tariff impacts. Trump Media stocks rose 19% on the policy shift.
Cryptocurrency markets saw mixed results. Bitcoin fell below $75,000 following early uncertainty but recovered 6% to around $82,000 following President Trump’s latest tariff announcement.
Also read: Crypto Chaos: US Tariff Surge Sends Bitcoin and Ethereum Into Tailspin
XRP reached $2, and Dogecoin gained 9.39%, while Ethereum saw a 10% surge, jumping to around $1,620.
Despite the rebound, Jamie Dimon, CEO of JPMorgan, has warned that a recession is a “likely outcome” of this tariff war, which leaves cause for concern in the market.
Economic Fallout Looms as Tariffs Threaten Holidays and Homes
Aside from short-term market volatility, the tariffs have massive economic implications. Holiday consumption is disrupted, with 87% of $4 billion in Christmas 2024 Chinese imports suspended as U.S. orders dried up through mid-April.
Also read: Ray Dalio Warns of Once-in-a-Lifetime Global Breakdown Amid Trump Tariff Debate
The mortgage sector is vulnerable too, with China and Japan holding $1.3 trillion in U.S. mortgage-backed securities—15% of the total. Analysts warn a sell-off could drive rates upward.
Tariff revenues explain the scale: China generates $1.24 billion daily, Vietnam $94.86 million, and the EU $12.2 million, totaling over $640 billion annually.
While stock and crypto recoveries show resilience, the unresolved U.S.-China tension keeps investors cautious.
