Wall Street Indexes Rebound as Global Investors Worry About U.S. Safe-haven Status

Barry Adams
14 Apr, 2025
New York City

Stock market indexes extended gains from the previous session and previous week after the Trump administration sent mixed signals on the scope of tariffs on electronic products. 

The S&P 500 index and the Nasdaq Composite jumped more than 1% after the Trump administration paused country-specific tariffs on smartphones, computers, and semiconductors. 

At the same time, Commerce Secretary Howard Lutnick said the exemptions are not permanent, and Donald Trump said in a social media post that these electronic products will still attract 20% fentanyl tariffs. 

After a week of tumultuous trading, world markets closed higher, reacting to several twists in U.S. trade policy.

Last week, market indexes were the most volatile on record, amid confusion and market turmoil caused by the Trump administration's flip-flops.  

The Trump administration paused its country-specific tariffs for 90 days and kept the base tariffs of 10% on all imports except from China.

The announcement sparked a historic one-day market rally of 9% in New York, but those gains were trimmed on Thursday after China retaliated and vowed to “fight until the end.”

Global investors continued to pull out of U.S. assets, sparking a rare simultaneous decline in stocks, bonds, crude oil, and the dollar.

The sustained selling of U.S. Treasuries by foreign investors forced Donald Trump to halt his tariff war for now.

Last week's bond market sell-off rattled Treasury officials so much that they worried that the U.S. bond auction may fail, as foreign governments use their Treasury holdings. 

Markets are calm for now, but investor confidence in U.S. assets is shaken for now, and the sell-off in the bond market can resume at any moment if relations with China, Japan, and the European Union deteriorate.

China holds $760 billion, and Japan holds $1.0 trillion of U.S. Treasuries, according to data available from the U.S. Department of the Treasury.

Moreover, the silence of three bond rating agencies on U.S. trade policy also confirms the long-held view among bond investors that these so-called independent agencies are not as independent as they claim to be.

 

Commodities, Currencies, Indexes, Yields

The S&P 500 index increased 1.1% to 5,423.89, the Nasdaq Composite edged up 1.3% to 16,946.13, and the Russell 2000 index was up 1.3% to 1,885.13.

The yield on 2-year Treasury notes edged lower to 3.93%, 10-year Treasury notes decreased to 4.44%, and 30-year Treasury bonds declined to 4.84%.

WTI crude oil increased $0.59 to $62.09 a barrel, and natural gas prices edged higher by $0.05 to $3.58 a thermal unit.

Gold decreased by $32.05 to 3,203.10 an ounce, and silver edged down by $0.33 to $31.95.

The dollar index, which weighs the US currency against a basket of foreign currencies, decreased by 0.23 to 99.87, and it traded at the lowest level since April 2022.

 

Week Ahead 

In the week ahead, investors in the U.S. are looking ahead to the release of export and import price reports, retail sales, housing construction activities, and the industrial production report.

Earnings This Week 

On the earnings front, investors anticipate results from Goldman Sachs, Citigroup, Bank of America, United Airlines, Abbott Labs, UnitedHealth Group, American Express, Netflix, and Charles Schwab.

 

U.S. Movers 

Apple Inc. jumped 6% to $210.92 after the White House paused country-specific tariffs on smartphones, computers, and chips. 

Nvidia rose 3.4% to $114.71, Broadcom advanced 1.2% to $185.98, and AMD increased 4.4% to $97.50.

Pfizer Inc. decreased 0.3% to $21.90 after the drugmaker said it would halt development of a weight loss pill. 

The company decided to take this step after a trial patient experienced liver injury possibly caused by the drug.