U.S. Markets React to Trump Tariffs Amid Economic Concerns

U.S. stock markets experienced significant volatility following President Trump's announcement of a 90-day reprieve on certain tariffs, which initially spurred a rally, with the S&P 500 seeing its third-largest one-day gain since World War II. However, concerns about the long-term impact of tariffs, particularly a 104% tax on Chinese imports, continue to weigh on investors, leading to fluctuating futures and increased Treasury bond yields. Analysts warn that while the temporary tariff relief offers some optimism, uncertainty remains regarding future trade negotiations and potential inflation spikes. Federal Reserve officials anticipate that consumers will feel the effects of tariffs in the coming months, with inflation risks looming. The stock market is nearing bear market territory, with a decline approaching 20% from earlier highs, as fears of recession grow alongside rising borrowing costs. Overall, the market remains cautious, with mixed signals regarding economic stability stemming from ongoing trade conflicts and tariff impacts.