Wall Street Erupts as 90-Day Tariff Suspension Sparks Historic Rally
The atmosphere on the floor of the New York Stock Exchange on Wednesday afternoon transformed from anxious silence to euphoric celebration in a matter of minutes, as traders scrambled to verify what appeared to be an unexpected but much-needed reprieve in the ongoing global trade war. President Donald Trump’s decision to temporarily pause a sweeping set of reciprocal tariffs for 90 days stunned financial markets, with equities exploding higher in a surge that brought echoes of past crisis recoveries. The S&P 500 Index soared 9.5% by the end of the day, recording its biggest single-day gain since the height of the global financial meltdown in October 2008.
Traders were left stunned by the rapid turnaround. Jonathan Corpina, senior managing partner at Meridian Equity Partners, captured the chaos in his disbelief: “Is it real? I couldn’t believe my eyes. Everything happened so quick.” As breaking news alerts flashed across trading terminals, the trading floor reverberated with roars, shouts, and urgent cross-checks. After days of brutal selloffs driven by fears of protectionist overreach, Trump’s decision to freeze the latest round of tariffs against dozens of trading partners brought a moment of collective relief — albeit a cautious one.
Highlights:
NYSE erupted as news of Trump’s 90-day tariff pause broke.
S&P 500 surged 9.5%, biggest gain since October 2008.
Traders scrambled to verify news in real-time amid sharp volatility.
Tariff Freeze Triggers Market Euphoria but Skepticism Persists
Wall Street had been pleading for clarity and leniency from the White House for days. Following Trump’s April 2 announcement of sweeping reciprocal tariffs, investor sentiment had cratered. The S&P 500, reeling from the aggressive policy turn, had briefly slipped 20% from its recent highs on Monday and Tuesday, triggering widespread risk-off moves and talks of an imminent market correction. Though Trump initially remained defiant in the face of the market rout, his administration relented roughly 13 hours after the latest round of duties—targeting 56 countries and the European Union—had gone into effect.
Jay Woods, chief global strategist at Freedom Capital Markets and a 35-year veteran of the NYSE, described the reaction as nothing short of “shock and awe.” According to Woods, “The floor erupted. Everyone was shouting ‘What is it?’ ‘What did Bessent say?’ ‘Are tariffs paused?’” The name of Treasury Secretary Scott Bessent ricocheted across the room as traders tried to piece together whether the reprieve was real or just another temporary head fake. For a market battered by uncertainty and headline-driven volatility, even a 90-day pause carried seismic importance.
Despite the celebration, some measure of caution remained. The baseline 10% tariffs are still in place, and Trump’s escalating feud with China appears far from resolved. Indeed, just a day prior, he had hiked tariffs on Chinese imports to an eye-watering 125%, following Beijing’s retaliatory move of slapping 84% tariffs on American goods. This bifurcated approach—easing pressure on certain allies while tightening the noose on Beijing—has left investors struggling to predict what the administration’s next move could be.
Highlights:
Markets had demanded action after a 20% correction; Trump delivered a partial retreat.
Traders cited Treasury Secretary Bessent as a key figure behind the shift.
Core tariffs remain, particularly against China, limiting broader optimism.
Relief Rally Reflects Hope, Not Resolution
While the stock market staged a historic rebound, seasoned traders noted that much of the optimism was based on relief rather than a fundamental resolution. “Crisis averted for now, but what’s next?” asked Woods, highlighting that the earlier damage to investor confidence and capital flows may take weeks, if not months, to reverse. With core tariffs still active and no formal withdrawal of Trump’s broader protectionist agenda, there remains considerable uncertainty surrounding U.S. trade policy.
The memory of previous sudden reversals—where Trump would walk back conciliatory measures with a single tweet—continued to weigh heavily on market participants. Corpina, who has weathered the dot-com collapse, the 2008 financial crisis, and the COVID-19 market crash, was quick to temper enthusiasm. “We’re relieved — for now — but we’ve seen this all before. Anything could flip on a dime,” he said. Traders may have celebrated, but many remained wary of the unpredictable political environment.
The initial flood of risk-on trades saw many clients move into high beta names and growth sectors, hoping to ride the rally. But others took a more conservative stance, favoring defensive dividend-paying stocks, signaling that the investor base remains split between short-term optimism and long-term skepticism. The lack of clear diplomatic roadmaps or enduring trade policy leaves the door wide open for more volatility.
Highlights:
Rally driven more by relief than resolution; uncertainty persists.
Market veterans caution that the situation can change rapidly.
Investors divided between chasing gains and seeking safety in defensive plays.
