The stock market experienced a brief surge on Monday, driven by speculation that President Trump might pause his tariff rollout. The administration swiftly dismissed this notion, ending the short-lived rally.
This “tariff reprieve” highlighted the market’s desire for a change in US trade policy to stabilize equity prices. DataTrek’s Nicholas Colas noted that only a modest adjustment in tariffs would be enough to calm markets. However, investors know that economic forecasts are subject to many variables and uncertainties.
The recent economic data releases and earnings have raised questions about the impact of reciprocal tariffs on growth estimates and year-end levels. Mark Hackett, chief market strategist at Nationwide, advises caution when making predictions about rate cuts or trade tensions due to the numerous factors involved.
With no clear solution in sight, contingency planning is a reasonable approach, as even perceived policy breakthroughs may be unattainable. The stock market’s actions suggest that investors are seeking relief from the current volatility, but finding a lasting tariff détente will be challenging.
Source: https://finance.yahoo.com/news/wall-street-got-a-preview-of-what-could-stop-the-tariff-turmoil-morning-brief-100056957.html