S&P 500 Surges 9.5% as Trump Pauses Tariffs, Market Recovers from Trade Shock

New York – The S&P 500 index experienced a significant rebound, surging 9.5% by early April 2025, as global markets reacted positively to President Donald Trump's announcement of a 90-day pause on reciprocal tariffs. This move came after an initial market shock triggered by his "Liberation Day" tariff plan unveiled on April 2, 2025, which had sent major indices tumbling. The Nasdaq Composite also saw a substantial jump of 12.2%.

The market's recovery was fueled by a combination of factors, including a better-than-expected U.S. jobs report and indications from China that it was open to trade talks. President Trump's softened stance on tariffs, where he hinted that the previously announced 145% tariffs on Chinese imports would "come down substantially" and confirmed a temporary pause for other countries, provided much-needed relief to investors.

John Melas-Kyriazi, co-founder of venture capital software company Standard Metrics, commented on the market's swift turnaround, stating, > "I did buy. But I’m disgusted with myself how little I bought." His remark highlights the rapid and unexpected nature of the rebound, catching some investors off guard despite the underlying volatility. Standard Metrics, founded in 2020, provides automated, AI-driven portfolio reporting solutions for venture capital firms, managing over $300 billion in assets under management across its client base.

The initial tariff announcement on April 2 had introduced considerable uncertainty, with the S&P 500 logging losses in five of the preceding six weeks. Companies like Apple and Amazon had warned of significant tariff headwinds, impacting their financial outlooks. However, the subsequent de-escalation signals from the White House and Beijing quickly shifted market sentiment.

Analysts noted that while the tariff pause offered temporary relief, the long-term implications of trade policies remained a key concern. The market's "hypersensitivity to incessant news flow" was evident, with swift swings in sentiment based on political rhetoric. Despite the rally, some experts cautioned that the economic outlook remained uncertain, particularly for industries heavily reliant on global supply chains.

The week's gains saw the S&P 500 recover all losses incurred since the April 2 tariff announcement, marking its longest winning streak since November 2004. This rebound underscored the market's responsiveness to trade policy developments and the ongoing influence of geopolitical factors on investor confidence. The focus now shifts to the progress of trade negotiations and their potential to stabilize the global economic environment further.