Just when the stock market appeared to take the first steps toward getting back on track, the White House yanked it back into the fog.
The week began with a long-awaited rally, juiced by President Trump signaling the April 2 tariffs would be narrower than initially feared. The S&P 500 (^GSPC) was back in the 5,700s and looking at 5,800.
But then came a fresh round of auto tariffs — a disorienting case of going two steps forward, one step back. Most of Thursday saw the index surfing the 5,700 mark before falling beneath it.
The halting market action feels all the more painful because price levels sit far below the very recent past. Far from that Golden Trump Age of … well, just a few weeks ago, when investors believed he would usher in a new era of growth.
Watching Wall Street reduce itself to tariff prediction bets and trying to divine the implications of ambiguous, ever-changing government decrees causes its own kind of discomfort.
But that distress gets at a broader truth. The whiplash of rejoicing over retaliatory good news and fretting over auto bad news isn’t a distraction from the market environment, it’s the new normal.
That’s because the economic picture isn’t being informed by tariffs; it’s all tariffs all day. From one trading session to the next, it’s true enough that good tariff news blunts the bad tariff news and vice versa. But zooming out even just a little underscores that the palace intrigue of trade threats, exemptions, and dealmaking distorts how little clarity exists on what comes next.
If Monday’s breakthrough comes undone by Friday, all that false hope adds up, and you’re left with confusion. That’s why clarity on the administration’s new policies remains the biggest catalyst to a market comeback.
A sober accounting of the tariff landscape, as we know it today, suggests that the new wave of levies grouped with the coming tariffs represents a more nuanced approach from the White House.
“At the margin, the Trump administration’s decision to impose 25% tariffs on vehicles and parts, while also seemingly dialing down its rhetoric on the reciprocal tariff plan … suggest that it may be putting more weight on the idea of using tariffs in a more targeted way to protect those industries deemed most important to national security,” Capital Economics wrote in a note on Thursday.
But new targeted tariffs still mean more tariffs, and it remains to be seen what will happen on “Liberation Day,” when the reciprocal volley is unleashed.
At every instance, the president has conveyed that whatever obstacles arise — higher prices, a weakened stock market, frayed alliances, and stunted growth — the foreseeable future will be on his terms. Or if other governments prefer, more tariffs.
Hamza Shaban is a reporter for Yahoo Finance covering markets and the economy. Follow Hamza on X @hshaban.
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