Sinéad Carew and Shashwat Chauhan
Wed, Apr 9, 2025, 2:44 AM 5 min read
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By Sinéad Carew and Shashwat Chauhan
(Reuters) – The S&P 500 soared 9.5% on Wednesday for its biggest daily gain since 2008 after U.S. President Donald Trump declared an immediate 90-day tariff pause for many countries, bringing some relief to investors worried about the global economic impact of U.S. trade policies.
The rally, which followed Wall Street’s biggest four-day percentage loss since the pandemic, was triggered by an afternoon announcement that Trump would temporarily lower many new tariffs, while he raised the levy on Chinese imports to 125%.
The pause of heftier tariffs on dozens of countries came less than 24 hours after they kicked in. However, the White House kept a 10% blanket duty on almost all U.S. imports.
The increase in China tariffs was in retaliation for China’s announcement of an 84% levy on U.S. goods starting April 10.
Traders took the opportunity to shop for beaten-down stocks. Since Trump announced broad tariffs late on April 2, stocks had fallen more than 12%.
“This is the pivotal moment we’ve been waiting for. The immediate market reaction has been overwhelmingly positive, as investors interpret this as a step toward much-needed clarity,” said Gina Bolvin, president of Bolvin Wealth Management Group.
“However, uncertainty looms over what happens after the 90-day period, leaving investors to grapple with potential volatility ahead.”
After Trump’s pause announcement, Goldman Sachs said it was rescinding its recession forecast and reverting to its previous baseline estimate for the economy to grow in 2025.
Kevin Gordon, senior investment strategist at Charles Schwab, said the rally from oversold levels made sense but cautioned that “to have a high conviction call on anything right now is a fool’s errand.”
“We just have to wait and see what the ultimate policy is, but unfortunately the policy changes almost on a daily basis,” said Gordon, adding he was concerned about companies’ ability to make spending and hiring decisions in such an environment.
Even with the rally, all three of Wall Street’s major averages ended the session below the April 2 close, the last trading day before Trump unveiled broad tariffs.
The Dow Jones Industrial Average rose 2,962.86 points, or 7.87%, to 40,608.45.
The S&P 500 gained 474.13 points, or 9.52%, to 5,456.90 for its biggest daily gain since October 2008, during the global financial crisis.
The Nasdaq Composite added 1,857.06 points, or 12.16%, to 17,124.97, for its biggest gain since January 2001, during the dotcom market bubble.
