Stock Markets Look To Give Back Some Gains Following Trump’s Tariff Announcements

President Donald Trump announced a more lenient approach to his trade agenda on Wednesday, leading to a significant rally in the stock market. In a post on Truth Social, Trump declared a 90-day pause on escalating tariffs and a reduction in the Reciprocal Tariff to 10% from previously planned increases. This approach has been interpreted as a softer stance on trade relations.

In reaction to these developments, the stock market surged with notable climbs in those stocks most impacted in recent weeks, technology stocks. The MAGS ETF, tracking the performance of the Magnificent 7 stocks gained 14.62% on the day, yet remains more than 14% down from where it began the year.

Tesla's stock soared nearly 23%, while Nvidia's (NASDAQ: NVDA) shares increased close to 19%. Other prominent tech companies also saw their stock prices rise significantly: Apple Inc. climbed over 15%, Meta Platforms (NASDAQ: META) rose nearly 15%, Amazon (NASDAQ: AMZN) surged about 12%, Microsoft (NASDAQ: MSFT) gained more than 10%, and Alphabet Inc. (NASDAQ: GOOG) climbed nearly 10%.

A reversal in fortunes on the day, most definitely, but a true shift in sentiment may be harder to find, with the Nasdaq 100 a decline of more than 2.5% through the early part of the pre-market when tracking the QQQ ETF.

The U.S. Treasury, led by Secretary Scott Bessent, along with administration officials, coordinated efforts to reassure investors, emphasising that the negotiation process would be tailored but provided few specifics.

This scenario represents a complex mix of optimism in the stock market juxtaposed with caution and potential risks in international trade dynamics.