Stock markets have bounced back since President Donald Trump imposed tariffs on array of goods and countries in early April.
Markets fell sharply after Trump announced his widest set of tariffs yet on April 2. Stocks suffered as investors feared Trump’s policies would lead to a major economic slowdown.
But on Friday, the S&P 500, a broad stock index, rose 1.5% and closed above where it stood before the sharp drop in April, according to The New York Times.
A strong jobs report on Friday helped move stocks higher, according to The Washington Post. But shares had been rising even before that report.
Stocks fell Monday and are trading lower so far Tuesday morning.
Although Trump paused the April tariffs on most nations, he left in place steep levies on China. Tariffs on most Chinese goods now total 145%.
China responded with stiff tariffs on U.S. products.
But both the U.S. and China have given indications they want to resolve the situation with a deal.
That has reassured investors, the Times said.
“If the labor market holds up and the Trump administration walks back the most egregious tariffs, the economy could skirt a deep recession,” said Jeffrey Roach, chief economist at LPL Financial, according to the Times.
Despite the recovery in April, stocks are still lower so far this year. The S&P 500 is down from its most recent high in mid-February and is lower since Trump’s inauguration in January, the Times said.
Questions remain about whether Trump’s policies will lead to a slowdown in the economy, according to the Times. Consumer confidence is low and Americans are giving Trump poor marks in polls for his handling of the economy.
Trump’s 90-day pause on the tariffs he announced in April ends in July, the Times noted.
“The damage to economic momentum has already been done,” said Mike Sanders, head of fixed income at Madison Investments, according to the Times. “Deals may come, but the real question is how long the data will take to reflect the harm.”
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