- Markets swung wildly after Trump imposed—and then partially paused—massive tariffs, sparking uncertainty and a rebound. While China faced steeper duties, global talks cooled the storm… a little.
- Wall Street rallied big time, with the S&P 500 posting its best week in over a year. But recession fears are growing—consumer sentiment’s tanking, and major banks are warning of a tougher economy ahead.
- Tariffs are still expected to raise prices on everyday goods like electronics and groceries. Analysts say inflation might creep up again by year’s end, despite the temporary policy rollbacks.
First the tariffs were on… then sort of off. But not for China. They got slapped even harder, and—unsurprisingly—hit right back. The result? Wall Street went into a spin before snapping back to life with its strongest weekly gain in more than a year.
Last week was, in a word, chaotic. Between surprise policy U-turns, rising inflation fears, and whispers of a looming recession, everyone from economists to everyday consumers is feeling the heat.
“The economy is facing considerable turbulence,” said JPMorgan CEO Jamie Dimon on Friday. The bank reported strong earnings—but also warned of some serious bumps ahead.
Both JPMorgan and Morgan Stanley made big gains from stock trading, as investors scrambled to reshuffle positions in light of all the trade drama.
Markets See-Saw, Then Snap Back
The Dow? Up 4.9% for the week. Nasdaq jumped 7.3%. S&P 500? Best week since Nov. 2023, gaining 5.7%. Not bad… except it’s still down 5.5% since April 1—that’s the day President Trump dropped his latest round of tariffs like a thunderbolt.
Those tariffs, by the way, were mostly paused later in the week (well, for most countries… not China). The White House says Trump is “optimistic” about a deal, and that comment alone was enough to send stocks soaring on Friday.
Still, finance pros say we’re not out of the woods.
“We expect continued volatility and uncertainty,” Wells Fargo told investors Friday, noting that they’re prepping for a slower 2025 economy either way.
BlackRock CEO Larry Fink went even further: “We’re very close, if not already in, a recession,” he said during a CNBC interview.
Sentiment Slumps, Prices Set to Climb
Consumer confidence? Dropping like a rock—down 11% in the latest University of Michigan survey. And this was before the whole “tariffs on 90 countries, never mind, just kidding (except China)” thing.
“Business conditions, incomes, labor markets—all deteriorating,” the survey’s researchers wrote. Yikes.
Let’s talk tariffs again. China didn’t get the 90-day break. In fact, Trump hiked their rate to a jaw-dropping 145%. Beijing responded with 125% tariffs on U.S. imports. So, yes, the trade war is still very much alive.
Morgan Stanley summed it up pretty well in a Friday note: “This just prolongs the uncertainty.”
“A delay isn’t the same as removal,” they said. “Prolonged uncertainty hurts confidence—and that drags down business spending and hiring.”
Inflation Is Calming… For Now
Some good news (sort of): March inflation came in softer than expected, dropping to a 2.4% annual rate. Wholesale prices fell too. But don’t pop the champagne.
“That was nice, but don’t get used to it,” warned Greg McBride from Bankrate, pointing to creeping unease across the economy.
Analysts warn that prices for everything from auto parts to almonds could start climbing again soon thanks to tariffs. Chinese-made electronics, toys, and gaming consoles? Yeah—expect hikes there too.
Barclays researchers noted a “stock-up” rush before Trump’s April 2 announcement. Warehouse club foot traffic spiked nearly 10% at the end of March—possibly shoppers trying to get ahead of higher prices.
They think firms will gradually pivot away from China to dodge the highest tariffs, keeping the average rate closer to 10%. Still, their outlook for inflation this year? 4.1% by December. Not great.
Final Thoughts: The Storm May Just Be Starting
“The tariff Armageddon unleashed by Trump last week has been a black cloud over stocks,” Wedbush analysts wrote. So far, the damage has mostly hit Wall Street… but that could change—fast.
