Wall Street has been whipsawed for more than a week by President Trump’s every word about tariffs. Now he’s facing accusations of using his power to deliberately manipulate the markets.
The scrutiny started with a tale of two social media posts. On Wednesday, shortly after the U.S. stock market opened, Trump posted on his Truth Social network in all caps: “THIS IS A GREAT TIME TO BUY!!!”
Less than four hours after his post, Trump said on Truth Social that he would pause the harshest of his tariffs on most countries.
Stocks immediately skyrocketed in relief, with the Dow closing up almost 3,000 points — meaning that any investors who had followed Trump’s advice in the morning and bought into the stock market right away would have made quite a bit of money by the end of the day.
Prior to his post, share prices had been plummeting for days, as fears mounted about the economic damage Trump’s new trade policies could cause. Powerful investors and billionaire business leaders had increasingly gone public airing their worries about the new tariffs and the resulting financial panic.
By Wednesday afternoon, Trump seemed to hear them when he hit pause.
Now some Democratic lawmakers and government ethics experts are calling for investigations into whether Trump was attempting to deliberately manipulate the markets, or to enable others to trade on insider information.
Sens. Adam Schiff, Democrat from California, and Ruben Gallego, Democrat from Arizona, sent a letter to the White House on Wednesday requesting “an urgent inquiry into whether President Trump, his family, or other members of the administration engaged in insider trading or other illegal financial transactions, informed by advanced knowledge” of his tariff policy changes.
Sen. Elizabeth Warren, Democrat from Massachusetts, also called for an investigation, asking on the floor of Congress if this was “corruption in plain sight.”
White House spokesperson Kush Desai accused Democrats of “playing partisan games” and tells NPR that Trump’s early-morning post was merely meant to calm investors’ fears.
“”It is the responsibility of the President of the United States to reassure the markets and Americans about their economic security,” he wrote in an emailed statement.
George W. Bush’s former chief ethics lawyer says such statements would have led to firing
But the criticisms of Trump’s two Truth Social posts aren’t just limited to his partisan opponents.
“We can’t have senior public officials — including the president — talking about stock prices and where to buy or to sell at the same time as they are making and announcing decisions that have a dramatic impact on stock prices,” says Richard Painter, a law professor at the University of Minnesota, who previously served as the chief ethics lawyer for President George W. Bush.
If anyone in the Bush administration had made similar public statements urging people to buy or sell stocks, Painter added, “that person probably would [have been] fired.”
Painter did not accuse President Trump of market manipulation: “We don’t have clear evidence of that here,” he tells NPR.
But he pointed out that the president already has a track record of pushing the boundaries, at the very least.
“Financial conflicts of interests for President Trump have been a concern since he was first elected in 2016,” Painter says, adding that the problems today are even greater.
Trump’s embrace of the crypto industry, for example, has drawn ongoing scrutiny: The president, who has a growing personal portfolio of cryptocurrency-related businesses, has appointed pro-crypto Cabinet officials and promised the industry much friendlier regulation.
It’s up to the SEC to investigate accusations of insider trading
Despite the wide-ranging calls for investigations into Trump’s social media posts on Wednesday, Painter and others aren’t expecting to see much happen.
The Republican lawmakers who control both the House and Senate have shown little interest in picking fights with Trump. Nor do ethics experts expect much movement from the U.S. Securities and Exchange Commission, which investigates accusations of insider trading.
On Wednesday, the Senate voted to confirm Trump nominee Paul Atkins to lead the SEC. And Trump in February signed an executive order claiming more power over independent regulatory agencies, including the SEC.
An SEC spokesperson declined to comment on the matter.
President Donald Trump and his advisers said this was the plan all along: Scare the bejesus out of the world by announcing astronomically high tariffs, get countries to come to the negotiating table, and — with the exception of China — back away from the most punishing trade barriers as America works out new trade agreements around the globe.
But Trump’s 90-day pause on his “reciprocal” tariffs that were never actually reciprocal gives his administration just three months to strike enormously complex trade deals with dozens of countries that it says are lining up to negotiate.
Financial markets aren’t buying it. Stocks have whipsawed as volatility has spiked. And other markets, including oil, bonds and the dollar, are sending a clear message of deep skepticism that Trump will be able to pull this one off.
Stocks
Following another steep sell-off Thursday, stocks appeared calmer — for now — and posted strong gains Friday.
The Dow ended the day higher by 619 points, or 1.56%. The S&P 500 rose 1.81% and the Nasdaq was 2.06% higher. Markets were buoyed by Boston Federal Reserve President Susan Collins telling the Financial Times Friday that the central bank would step in to support financial markets if there were signs of distress.
But stock market investors have been trading on a knife’s edge, and any announcement coming from the Trump administration on tariffs has the ability to send stocks surging or tumbling. For example, stocks plunged Thursday after the Trump administration clarified the math it had already used to set China’s massive 145% tariff. The street had believed the tariff was 125%. The Dow sank sharply, at one point falling more than 2,000 points.
In the 129-year history of the Dow Jones Industrial Average, the index has closed higher or lower by at least 1,000 points just 31 times. Four of those times happened in the past week.
The S&P 500 fell by just over 9% across the first week of April, its biggest one-week drop since March 2020. The benchmark index gained 5.7% this week, its biggest one-week gain since 2023.
Despite Wednesday’s historic gain after Trump announced his detente, stocks remain well below where they were trading before the president presented his “Liberation Day” tariff plan on April 2.
Bonds
The bond market is acting weirdly.
Typically, you’d expect bond prices to rise throughout periods of turmoil. US Treasuries are historically considered to be the safest of safe assets, backed up by the full faith and credit of the US government.
But bonds aren’t rising — they’re falling.
That’s largely because investors have lost faith in US trade policy, and they fear America could get hurt even worse than the countries Trump’s tariff policy is targeting. As JPMorgan Chase CEO Jamie Dimon said in his annual letter to shareholders Monday, Trump’s “America First” policy risks alienating its most important partners and the country’s special standing in the world.
US Treasury yields, which trade in opposite direction to prices, briefly surged on Friday above 4.5%. They were under 4% earlier in the week. That represents a massive move for the market. Higher yields could hurt America’s economy, as a number of consumer loans are closely tied to those rates.
“The upward action in rates has been rapid in historical context and has provided no comfort to investors looking for havens in turbulent markets,” analysts at Citi said in a Friday note.
US Treasuries were on track for their worst week since 2019, according to Bloomberg’s US Treasury total return index, when the New York Federal Reserve had to step in and purchase Treasuries to bring down a spike in yields caused by a liquidity crunch.
“Current market conditions don’t require Fed intervention at this point, but Fed officials are likely monitoring market function closely,” said Chip Hughey, managing director for fixed income at Truist Advisory Services.
Dimon said Friday on an earnings call that he expects there will be a “kerfuffle” in the Treasury markets that would lead to the Federal Reserve intervening.
“They’re not going to do it now … they’ll do it when they start to panic a little bit,” Dimon said.
Oil
The oil market has been trading like we’re going into a recession.
Prices have tumbled over the course of the past couple of weeks as investors feared Trump’s trade policy could sap demand for travel, shipping and transportation — all of which require fuel.
US oil on Friday morning fell below $60 a barrel, close to a four-year low, before recovering slightly. Brent, the global benchmark, was hovering around $63 a barrel, the lowest since April 2021, before also gaining slightly.
Oil gained on Friday after US Energy Secretary Chris Wright told reporters that the US could stop Iran’s oil exports as part of Trump’s negotiations over the nation’s nuclear program, according to Reuters. US oil settled up 2.4% at $61.50 a barrel. Brent rose 2.26% to $64.76 a barrel.
Yet concerns remain about the impact of tariffs on economic growth and how a potential slowdown could disrupt demand for oil.
Oil prices have served as a prime recession indicator in recent years. Prices tumbled after surging above $100 a barrel for the first time as the Great Recession took hold in 2008. And prices went negative for the first time during the pandemic as a glut of oil became so severe that traders were literally paying storage facilities to take the unwanted oil off their hands.
Dollar
The dollar on Friday tumbled to its lowest level in three years. That’s the opposite of what you’d expect when tariffs are put in place.
Typically, tariffs raise the value of a local currency, because it encourages residents to purchase homemade goods instead of foreign options, stretching their money further in comparison to other currencies.
But currency traders have sold off the dollar, because they believe America will bear the brunt of Trump’s trade war fallout and end up comparatively weaker than before tariffs were put in place.
The dollar on Friday hit its lowest level against the euro since 2022. The dollar index — which measures the dollar against a basket of currencies — fell 0.9% Friday after tanking 2% Thursday, which was its worst single-day drop since 2022. Those are massive moves in currency trading world.
“Investors and central banks are selling Treasuries and dollars due to a loss of confidence and credibility in American assets,” said Joe Brusuelas, chief economist RSM. “Financial chaos has its cost.”
Meanwhile, gold prices surged above a record high $3,200 a troy ounce on Friday. Gold is up more than 23% this year and just posted its best quarter since 1986. The yellow metal is considered a safe haven amid economic and political uncertainty.
Trade deals
Despite financial markets casting enormous doubt that the Trump administration can salvage the opportunity it created for itself to strike bilateral trade agreements with all 150 countries around the world, the Trump administration remains optimistic.
Treasury Secretary Scott Bessent said this week that more than 70 countries have asked to meet with US representatives to strike a deal that could get them out from under the thumb of Trump’s punishing tariffs. Although the administration has provided few details of which countries it is negotiating with, it said it would favor allies like South Korea and Japan first.
But trade deals are incredibly complex arrangements usually negotiated over the course of years, not months. And even if Trump were to negotiate trade with all those countries over a short period — whether full deals or letters of agreement that put a framework of a deal together — China, the world’s biggest exporter, remains the elephant in the room.
US tariffs on China are now at at least 145% and China on Friday retaliated with 125% tariffs of its own. That will do enormous damage to the world’s two largest economies, and both sides have said they are not eager to back down.
China has consistently said it is open to negotiations, but wants to do it in a way in which it will be respected. China has ignored America’s warnings not to raise its tariffs, according to a source familiar with the discussions.
In the meantime, economists have been unmoved by Trump’s sudden change in tune. Although negotiated trade agreements would undoubtedly be good news for the economy, much of the damage has already been done, Wall Street economists have argued. And punishing 10% universal tariffs remain in place, as do 25% tariffs on autos, 25% tariffs on some goods from Mexico and Canada, and 25% tariffs on steel and aluminum.
That’s why JPMorgan and Goldman Sachs say the likelihood of the United States and the global economies going into a recession this year are basically a coin flip.
This story has been updated with additional developments and context.
The 10-year Treasury yield climbed higher Friday, adding to its steep weekly rise, as dizzying trade moves by President Donald Trump caused investors to dump U.S. assets in favor of other global safe havens.
The benchmark 10-year Treasury yield advanced 9 basis points to 4.486%. It earlier jumped to its highest level since Feb. 13. The 2-year Treasury yield climbed 12 basis points on the day at 3.97%.
One basis point is equal to 0.01% and yields move inversely to prices.
The 10-year yield this week has risen more than 50 basis points this week after ending last week around 4%, marking one of the biggest spikes on record.
The move marks a stark reversal in how investors view Treasurys. Traditionally, investors have turned to U.S. debt as a safe haven during tumultuous times. That doesn’t appear to be the case this week as China and Japan appeared to be selling Treasurys amid the heightened trade tensions, traders speculated.
The move higher may have complicated the White House’s approach to trade.
Trump announced a 90-day tariff pause on most countries on Wednesday and reduced duties to a universal rate of 10%. The reprieve excluded China, which saw U.S. tariffs on Chinese imports rise to 145%. China struck back against the U.S. on Friday, raising its duties on American goods from 84% to 125%. While some administrations officials have said this reversal was always the plan, the dramatic spike in yields likely pressured them to pause.
“Scott Bessent is keeping a close eye on the bond market. He spoke to the White House and I know he is keeping his eyes on it,” the White House said on Friday.
Kevin Hassett, director of Trump’s National Economic Council also told CNBC on Thursday “the fact that the bond market was telling us, ‘Hey, it’s probably time to move,’ certainly would have contributed at least a little bit to that thinking.”
“But it wasn’t the bond market that made a panic move, because there was a very systematic, well-planned move that was just about to happen that just turned out to be the same time,” Hassett added.
Seema Shah, chief global strategist at Principal Asset Management, added that the bond market “likely struck a nerve with the Trump administration.”
“They have repeatedly emphasized their focus on bond yields and even celebrated last week when Treasury bond yields dipped below 4%. Low financing costs appear to be a key pillar of the Trump administration’s overall agenda, so the reversal in market trends, surging Treasury yields, undoubtedly caused significant concern in the White House,” Shah said.
Despite the pause, however, rates resumed their upward climb to the high levels that previously sparked concerned for the White House.
Americans are rarely this pessimistic about the economy.
Consumer sentiment plunged 11% this month to a preliminary reading of 50.8, the University of Michigan said in its latest survey released Friday, the second-lowest reading on records going back to 1952. April’s reading was lower than anything seen during the Great Recession.
President Donald Trump’s volatile trade war, which threatens higher inflation, has significantly weighed on Americans’ moods these past few months. That malaise worsened leading up to Trump’s announcement last week of sweeping tariffs, according to the survey.
“This decline was, like the last month’s, pervasive and unanimous across age, income, education, geographic region and political affiliation,” Joanne Hsu, the survey’s director, said in a release.
“Sentiment has now lost more than 30% since December 2024 amid growing worries about trade war developments that have oscillated over the course of the year,” she added.
The Federal Reserve and Wall Street are watching closely how souring sentiment translates into consumer spending, which accounts for about 70% of the US economy, and whether Americans lose faith that inflation will return to normal in the coming years.
Trump on Wednesday paused his massive tariff hike on dozens of countries for 90 days, but kept in place a 10% baseline duty for all imports into the US and separate tariffs on specific products and commodities. The so-called reciprocal tariffs, albeit short lived, were the sharpest increase in US duties ever on data going back 200 years, Fitch Ratings told CNN
China, however, wasn’t included in Trump’s tariff reprieve, continuing a contentious tit-for-tat between the world’s two largest economies that stretched into Friday, with Beijing jacking up its retaliatory tariffs on US imports to 125% from 84%.
The Michigan survey was fielded between March 25 and April 8, so it doesn’t capture respondents’ reaction to the recently announced tariff delay.
The relationship between sentiment and spending
In economics, surveys are referred to as “soft data” and measures capturing actual economic activity, such as retail sales, are known as “hard data.”
The soft data has clearly deteriorated because of Trump’s tariffs: The latest Michigan survey showed that “the share of consumers expecting unemployment to rise in the year ahead increased for the fifth consecutive month and is now more than double the November 2024 reading and the highest since 2009,” according to a release.
Yet, the hard data still looks decent. Employers continue to hire at a brisk pace and shoppers haven’t convincingly reined in their spending just yet, though retail sales have come in weaker than expected recently.
“Sometimes the surveys are very negative, but they keep spending,” Fed Chair Jerome Powell said last week at an event near Washington, DC. “People spent right through the pandemic and they spent right through this time of higher inflation.”
Still, the hard data could take a turn for the worse. New York Fed President John Williams said Friday at an event in Puerto Rico that he expects economic growth to slow sharply this year, pushing up unemployment, and for inflation to accelerate.
“Given the combination of the slowdown in labor force growth due to reduced immigration and the combined effects of uncertainty and tariffs, I now expect real GDP growth will slow considerably from last year’s pace, likely to somewhat below 1%,” he said.
Spending by better-off Americans has played a key role in keeping the US economy humming along these past few years, but the recent turbulence on Wall Street, triggered by Trump’s tariffs, is putting that under threat.
“Wealthy consumers’ stock market gains kept the economy growing in 2024 despite high prices, but the wealthy won’t feel confident enough to keep spending if this keeps up,” Bill Adams, chief economist at Comerica Bank, wrote in a recent analyst note.
Larry Fink, chief executive of BlackRock, the world’s largest asset manager, said Friday that today’s dense fog of uncertainty, triggered by Trump’s tariffs, is reminiscent of the 2008 global financial crisis.
“We’ve seen periods like this before when there were large, structural shifts in policy and markets — like the financial crisis, Covid-19 and surging inflation in 2022. We always stayed connected with clients, and some of BlackRock’s biggest leaps in growth followed,” Fink said.
JPMorgan Chase CEO Jamie Dimon echoed that sentiment, noting Friday after the bank released its latest quarterly earnings: “The economy is facing considerable turbulence (including geopolitics), with the potential positives of tax reform and deregulation and the potential negatives of tariffs and ‘trade wars.’”
A growing worry for the Fed
There’s one survey-based measure that matters a whole lot for the Fed: Americans’ perception of prices. It’s critical because they can be self-fulfilling — if people expect inflation to climb and remain elevated in the long run, they adjust their spending accordingly.
So far, that measure has been trending in the wrong direction: Expectations for inflation rates in the year ahead surged to 6.7% this month from 5% in March, the highest level since 1981, while expectations for the next five to 10 years climbed to 4.4% from 4.1%.
If people do lose faith that inflation will ever get back to normal in the coming years, that would make it extremely difficult for the Fed’s monetary policy to fight inflation.
“History teaches that when higher inflation expectations become entrenched, the road back to price stability is longer, the labor market is weaker and the economic scars are deeper,” Dallas Fed President Lorie Logan said Thursday at an event in Dallas.
Inflation expectations these days may be more susceptible than usual to becoming “un-anchored,” since consumers just experienced a period of high inflation, leaving many Americans particularly sensitive to elevated prices.
A photo is showing the Amazon booth at an exhibition in Hangzhou, China, on November 23, 2023. (Photo by Costfoto/NurPhoto via Getty Images)
Chinese companies that sell to US customers on Amazon are reportedly preparing to raise prices or quit the US market because of tariffs imposed by President Trump. Amazon CEO Andy Jassy has meanwhile confirmed that he expects the cost of tariffs to be passed on to US buyers.
Reuters talked to several individual sellers and a Chinese trade association that represents over 3,000 Amazon sellers for an article published today. “It’ll be very hard for anyone to survive in the US market” because “the entire cost structure gets entirely overwhelmed” by the tariffs, Reuters was told by Wang Xin, who leads the Shenzhen Cross-Border E-Commerce Association. Xin also “not[ed] the tariffs could also lead to customs delays and higher logistics costs.”
Trump increased tariffs on China imports to 125 percent yesterday even as he announced a 90-day pause on tariff hikes affecting other countries. The total tariffs are 145 percent because the newly raised tariff “comes on top of a 20 percent fentanyl-related tariff that Trump previously imposed on China,” CNBC wrote today.
It’s no surprise that tariffs of this size would have a big impact on Chinese sellers, who have been courted by Amazon for years and are a source of cheap products for US buyers (though those products are often of poor quality).
Amazon declined to comment about the tariffs’ impact on Chinese sellers when contacted by Ars today. But Jassy told CNBC that he expects sellers to pass the cost of tariffs on to consumers.
“I’m guessing that sellers will pass that cost on… depending on which country you’re in, you don’t have 50 percent extra margin that you can play with so I think they’ll try and pass the cost on,” Jassy said.
Jassy said Amazon is “doing everything we can to try and keep prices the way they’ve been for customers, as low as possible.” Amazon has already “done some strategic forward inventory buys to get as many items as make sense for customers at lower prices,” and may renegotiate some deals, he said.
Seller: “You can’t rely on the US market”
Reuters spoke to five Chinese sellers, writing that “three said they would look to raise prices for their exports to the US, while two planned to leave the market entirely.”
Dave Fong sells products “from schoolbags to Bluetooth speakers” and has already raised prices in the US by up to 30 percent, the article said. “For us and anyone else, you can’t rely on the US market, that’s quite clear,” Fong told Reuters. “We have to reduce investment, and put more resources into regions like Europe, Canada, Mexico, and the rest of the world.”
Products already shipped to Amazon fulfillment centers in the US soften the blow temporarily, but Shenzhen-based seller Brian Miller “anticipated he and other sellers would need to raise prices steeply when current inventories run out in one or two months.”
“Building blocks for children that sell on Amazon for $20 that cost his company $3 to produce would now cost $7 including the tariff. Maintaining margins would require raising the price by at least 20 percent, and prices for higher-cost toys might see 50 percent increases, he said,” according to Reuters. Miller said that if the tariffs aren’t changed, “manufacturing that serves the US will have to be transferred to other countries like Vietnam or Mexico.”
Bloomberg reported yesterday that Amazon “canceled orders for multiple products made in China and other Asian countries.”
Mortgage rates headed higher by most measures this week after President Trump’s tariff plans sparked fresh inflation fears and led to widespread market volatility.
Average 30-year mortgage rates were 6.92% on Thursday, according to Mortgage News Daily, up 29 basis points from a week earlier. Zillow has them at 6.84%, even after Trump paused tariffs on most countries.
Last week’s tariff announcement shattered several weeks of relative stability for mortgage rates. Rates initially fell, following Treasury yields lower, as investors feared a potential recession.
But what looked like a potential bright spot amid a broad stock market sell-off was short-lived. Ten-year Treasury yields, which closely track mortgage rates, swung wildly, then began marching higher this week amid concerns that the tariffs could usher in stagflation and hamper long-term foreign demand for US bonds.
“The economic situation is rapidly evolving,” Kara Ng, senior economist for Zillow Home Loans, said in a statement. “It’s hard to predict the direction of mortgage rates with any conviction.”
Trump said he was watching the bond market before he announced 90-day relief from higher tariffs for most countries on Wednesday.
“The bond market right now is beautiful,” he said Wednesday. “I saw last night where people were getting a little queasy.”
Ten-year Treasury yields fell somewhat after the higher tariffs were paused, but they remain elevated. They’re about 4.34% now, up from around 4.16% before “Liberation Day.”
Illustrating just how volatile rates were this week, Freddie Mac’s weekly mortgage rate survey, which runs through Wednesday, was an outlier, pinning the average 30-year mortgage rate at 6.62%, down slightly from 6.64% a week earlier. Fifteen-year mortgage rates remained flat at 5.82%.
Tim Stafford, a mortgage broker at Edge Home Finance, said that on a normal bad day for mortgage rates, he might receive two intraday updates from lenders notifying him that their rates were moving higher. On Monday, one large company sent him three.
He’s telling buyers who are comfortable with their monthly mortgage payments to lock in their rates despite the uncertainty. One recent client didn’t take this advice on Friday when rates were falling, only to call back on Monday during the upswing.
“I think in the long term, rates are going to come down,” Stafford said. “But you just don’t know where they’re going to be right now, so if it works for you now, I would lock.”
Mortgage applications jumped last week, helped by buyers and refinancers who managed to take advantage of the brief dip in rates. Applications to purchase a home rose 9% from a week earlier, according to the Mortgage Bankers Association, while refinancing applications surged 35%.
NEW YORK, April 10 (Reuters) – Wall Street stocks tumbled on Thursday on mounting worries over the economic impact of U.S. President Donald Trump’s multi-front tariff war.
All three major U.S. stock indexes suffered steep losses, forfeiting much of the previous session’s gains as growing concerns over the escalating Washington-Beijing trade face-off dampened optimism over upbeat economic data and U.S.-Europe trade negotiations.
After Trump announced a 90-day tariff reprieve on Wednesday, the S&P 500 surged 9.5%, the largest one-day percentage jump since October 2008. The tech-heavy Nasdaq soared 12.2%, notching its second-biggest daily gain on record.
Following the whipsaw of Wednesday’s bounce and Thursday’s selloff, the S&P 500 remained 7.1% below where it was just before the reciprocal tariffs were announced last week.
“Investors are still uncomfortable with it, because they don’t know what the end game is,” said Paul Nolte, senior wealth advisor at Murphy & Sylvest in Elmhurst, Illinois. “I think what we’re seeing, still, is investor concern about tariffs and that is pretty much front and center for everything.”
The Labor Department’s Consumer Price Index report showed the prices consumers pay for a basket of goods unexpectedly edged lower in March, with core price growth cooling down 2.8% year-on-year, coming within one percentage point of the Federal Reserve’s 2% inflation target.
Inflation gauges
But the Fed’s path forward, in light of ongoing trade negotiations, is less clear.
Fed Governor Michelle Bowman said on Thursday that while the U.S. economy remains strong, the effects of Trump’s trade policies are unclear, while Chicago Fed President Austan Goolsbee said rate cuts could resume once the uncertainties surrounding trade policy is resolved.
In response to Trump’s 90-day tariff pause, the European Union will delay retaliatory levies on American goods as countries within the bloc scramble to reach trade deals with Washington, said European Commission chief Ursula von der Leyen.
But the trade war with Beijing persists, with China vowing to “follow through to the end” if the U.S. does not let up.
The CBOE Market Volatility Index (.VIX), opens new tab, often called the “fear index,” remained elevated, but closed off the session high of 40.86.
“It’s hard for investors to feel comfortable about buying stocks with volatility so high,” Nolte added.
The Dow Jones Industrial Average (.DJI), opens new tab fell 1,014.79 points, or 2.50%, to 39,593.66. The S&P 500 (.SPX), opens new tab lost 188.85 points, or 3.46%, at 5,268.05 and the Nasdaq Composite (.IXIC), opens new tab dropped 737.66 points, or 4.31%, to 16,387.31.
Among the 11 major sectors in the S&P 500, all but consumer staples (.SPLRCS), opens new tab ended in negative territory, with energy (.SPNY), opens new tab and tech (.SPLRCT), opens new tab suffering the largest percentage drops.
Big Tech came under pressure once again, with each of the so-called Magnificent Seven group of artificial intelligence-related momentum stocks down between 2.3% and 7.3%.
CarMax (KMX.N), opens new tab slid 17.0% after the used-car retailer missed fourth-quarter profit expectations.
First-quarter earnings season kicks off on Friday with big banks, including JPMorgan Chase (JPM.N), opens new tab, Morgan Stanley (MS.N), opens new tab and Wells Fargo (WFC.N), opens new tab due to report.
Declining issues outnumbered advancers by a 4.81-to-1 ratio on the NYSE. There were 39 new highs and 224 new lows on the NYSE.
On the Nasdaq, 867 stocks rose and 3,588 fell as declining issues outnumbered advancers by a 4.14-to-1 ratio.
The S&P 500 posted no new 52-week highs and nine new lows while the Nasdaq Composite recorded 13 new highs and 166 new lows.
Volume on U.S. exchanges was 23.65 billion shares, compared with the 18.50 billion average for the full session over the last 20 trading days.
We recently published a list of Long-Term Stock Portfolio: 15 Best Stocks for 15 Years. In this article, we are going to take a look at where Broadcom Inc. (NASDAQ:AVGO) stands against other best stocks for 15 years.
Russell Investments believes that 3 features are defining the market outlook for 2025. These include the elevated level of the S&P 500 forward P/E ratio, the potential for further US dollar strength, as well as the direction of the US 10-year Treasury yield. The active equity managers have been challenged by the severe market concentration. The firm opines that a flattening out of such trends— which can be seen due to policy shifts or change in sentiments related to earnings growth and valuations for mega caps — can support active manager outperformance.
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Sectors Providing Investment Opportunities
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A technician working at a magnified microscope, developing a new integrated circuit.
Broadcom Inc. (NASDAQ:AVGO)
10-year Revenue Growth: ~26.5%
Number of Hedge Fund Holders: 161
Broadcom Inc. (NASDAQ:AVGO) is engaged in the designing, developing, and supplying of various semiconductor devices. Morningstar believes that the company’s primary valuation drivers revolve around the growth of its AI chip business as well as its capability to extract growth and operating leverage from VMware. The firm also expects continued inorganic growth over the long term. It expects high AI sales to fuel supernormal growth for Broadcom Inc. (NASDAQ:AVGO) over the next 5 years.
Broadcom Inc. (NASDAQ:AVGO)’s strength in both chips and software enables it to earn terrific accounting and economic profits, and Morningstar believes that its competitive positioning will continue to allow it to do so for the upcoming 20 years. As per the firm, Broadcom Inc. (NASDAQ:AVGO) will focus on healthy cash generation. Over the long term, Morningstar expects that the emphasis will be on improving its dividend and bolting on more acquisitions, which can help drive its cash flow. The company is expected to be a significant beneficiary of rising AI spending, which can spur strong growth for its networking semiconductor sales.
Carillon Tower Advisers, an investment management company, released its Q4 2024 investor letter. Here is what the fund said:
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The US stock market tumbled deeply into the red on Thursday as the White House clarified its plan for a massive 145% tariff on China, escalating a trade war.
The Dow, after rising nearly 3,000 points Wednesday, had a volatile day in the red on Thursday. The blue-chip index fell 1,015 points, or 2.5%, pulling back after tumbling as much as 2,100 points midday.
The S&P 500 fell 3.46% and the Nasdaq Composite slid 4.31%. The S&P 500 was coming off its best day since 2008, and the Nasdaq on Wednesday posted its second-best daily gains in history.
The stock market, fresh off its third-best day in modern history, is sinking back into reality: Although President Donald Trump paused most of his “reciprocal” tariffs, his other massive import taxes have already inflicted significant damage, and the economy won’t easily recover from the fallout.
After taking a victory lap Wednesday, the president on Thursday acknowledged some “transition problems” could be expected.
“A big day yesterday. There will always be transition difficulty — but in history, it was the biggest day in history, the markets. So we’re very, very happy with the way the country is running. We’re trying to get the world to treat us fairly,” Trump said in the Cabinet Room.
The US dollar index, which measures the dollar’s strength against six foreign currencies, tumbled 1.7% Thursday, hitting its lowest level since early October. The dollar has broadly weakened this year, a sign of investors’ concern about the health and stability of the US economy.
Gold prices hit a fresh record high above $3,170 a troy ounce on Thursday. The yellow metal is considered a safe haven amid economic and geopolitical turmoil and just posted its best quarter since 1986.
Stocks are volatile after short-lived relief rally
Traders were elated that Trump temporarily rescinded his so-called reciprocal tariffs, which aren’t really reciprocal, for 90 days. Those tariffs placed hefty levies between 11% and 50% on dozens of countries.
Stock futures on Thursday had also responded somewhat positively to the European Union’s announcement that it would temporarily pause its retaliatory tariffs on the United States in hopes of a negotiated trade agreement after Trump’s U-turn. Trump and Treasury Secretary Scott Bessent said more than 70 countries were lining up to negotiate trade deals with the United States to get out from under the tariffs, and the Trump administration wanted to provide time to strike deals.
But even after Trump’s about-face, the reality remains stark: Economists said the economic damage is done, and many say there is still an elevated risk of a US and global recession. Stocks are still well below where they were before Trump unveiled his “Liberation Day” tariffs last week, and those large stock market losses, existing tariffs and high degree of uncertainty about American trade policy are enough to sink the economy, they say.
Trump’s universal 10% tariff that went into effect Saturday remains in place, as do 25% tariffs on auto imports, 25% tariffs on steel and aluminum and 25% tariffs on some goods from Canada and Mexico. Trump also pledged to go forward with additional tariffs on pharmaceuticals, lumber, semiconductors and copper.
Goldman Sachs said Wednesday after Trump’s partial detente that recession chances in the United States were still a coin flip. JPMorgan Wednesday evening said the bank would not alter its recession forecasts, still seeing a 60% chance of a US and global recession even after Trump’s “positive” decision to unwind his “draconian” country-specific tariffs.
“My sense here is that the (US) economy is still likely to fall into recession, given the level of simultaneous shocks that it’s absorbed,” Joe Brusuelas, chief economist of consulting firm RSM, told CNN. “All this does is postpone temporarily what will likely be a series of punitive import taxes put on US trade allies.”
The CBOE Volatility Index, or Wall Street’s fear gauge, surged 40% Thursday. The VIX briefly traded above 50 points midday — a rare level associated with extreme volatility.
New data on Thursday showed that inflation in the US slowed sharply in March. While that is usually welcome news for investors, the focus on Wall Street is firmly on tariffs and the outlook for the economy going forward.
“Thursday’s [data] is for March, which is backward looking and doesn’t tell the market much about how the recent tariffs, albeit many of them on pause, are affecting consumer prices,” said Skyler Weinand, chief investment officer at Regan Capital.
China’s not backing down
Meanwhile, Trump isn’t backing off his alarming trade war with China — in fact, it’s getting worse. Goods coming from China to the United States are now subject to at least a 145% tariff, the White House clarified Thursday. The 125% “reciprocal” tariff Trump announced on China on Wednesday comes on top of the 20% tariff that had already been in place. It hadn’t been clear if the tariffs were additive.
Stocks immediately dipped lower after news outlets began reporting the clarification around 11 a.m. ET.
Also on Thursday, Beijing’s retaliatory 84% tariffs on US imports to China went into effect.
China says it remains willing to negotiate with the United States, but a spokesperson for the Chinese Commerce Ministry also reiterated Thursday that China will not back down if Trump chooses to further escalate the trade war.
“The door to talks is open, but dialogue must be conducted on the basis of mutual respect and equality,” the spokesperson said. “We hope the US will meet China halfway, and work toward resolving differences through dialogue and consultation.”
“If the US chooses confrontation, China will respond in kind. Pressure, threats and blackmail are not the right ways to deal with China,” the spokesperson said.
Signs of stress
Some billionaire investors, who have been pressuring Trump to back off his punishing tariffs, were elated that the president hit pause.
“There are better and worse ways of handling our problems with unsustainable debt and imbalances, and President Trump’s decision to step back from a worse way and negotiate how to deal with these imbalances is a much better way,” billionaire investor Ray Dalio said in a post on X late Wednesday, adding: “I hope… he will do the same with the Chinese.”
But signs of stress remain in markets beyond just stocks. The bond market, which had been selling off alarmingly fast — the 10-year Treasury yield surged past 4.5% Wednesday from under 4% earlier in the week — has cooled off just a bit. Yields rise when bond prices fall.
But the 10-year yield was above 4.3% Thursday. That’s not exactly a vote of confidence.
“Bonds are signaling that the pause is significant, yet not much has fundamentally changed,” said ING analysts in a note to investors Thursday. “Markets will not easily forget these episodes with wide market swings.”
Oil prices also remained under pressure. US oil fell again Thursday to below $60 a barrel, near where oil was in April 2021. Prices had fallen dramatically below $57 a barrel Wednesday before recovering. Brent crude, the global benchmark, also fell 4% to around $63 a barrel.
Still, global markets recovered sharply Thursday.
Japan’s benchmark Nikkei 225 index finished more than 9% higher, while South Korea’s Kospi index was up 6.6%. Hong Kong’s Hang Seng index jumped 2.1%. Taiwan’s Taiex rose 9.3%. In Australia, the ASX 200 closed up 4.5%.
European stocks surged after European Commission President Ursula von der Leyen paused retaliatory tariffs and said she welcomes Trump’s move to pause his “reciprocal” tariffs.
“It’s an important step towards stabilizing the global economy,” she said Thursday in a statement. “Clear, predictable conditions are essential for trade and supply chains to function.”
Europe’s benchmark STOXX 600 index was 3.7% higher Thursday. France’s CAC index was up 3.8% and Germany’s DAX jumped 4.5%, while London’s FTSE 100 index rose 3%.
Asia-Pacific markets fell Friday, after Wall Street resumed sell-off overnight as trade war tensions between the world’s two largest economies fueled risk-off mood.
Australia’s S&P/ASX 200 fell 2.28%.
Japan’s Nikkei 225 lost 5.46%, while the Topix traded 5.05% lower. South Korea’s Kospi fell 1.55% and the small-cap Kosdaq declined 0.11%.
Hong Kong’s Hang Seng Index was down 0.8% while China’s CSI 300 dipped 0.13%.
U.S. President Donald Trump announced a tariff U-turn Wednesday, dropping the new reciprocal tariff rates on imports from most countries for 90 days.
“The extension of time does not alleviate uncertainty,” ANZ analysts wrote in a note. “There is skepticism about the outcome of trade negotiations, and that will continue to weigh on investment and thus the growth outlook.”
Additionally, the cumulative tariff rate on China now would be 145%, the White House confirmed to CNBC on Thursday. The figure consists of the new 125% duty on goods, on top of the 20% duty linked to the fentanyl crisis.
U.S. stock futures moved higher as investors look to close out a volatile week, punctuated by sharp swings for the major averages. S&P 500 futures added 0.3%, while Nasdaq 100 futures climbed roughly 0.1%. Futures tied to the Dow Jones Industrial Average ticked higher by 28 points, or nearly 0.1%.
Overnight in the U.S., the three major averages closed lower, giving back some of the gains from the historic rally seen in the previous session after President Donald Trump announced a 90-day reprieve on some of his “reciprocal” tariffs.
The S&P 500 sold off 3.46% and closed at 5,268.05, while the Nasdaq Composite slid 4.31% to end at 16,387.31. The Dow Jones Industrial Average dropped 1,014.79 points, or 2.5%, settling at 39,593.66.
