Stock Market Update: A Wild Week of Tariff-Driven Volatility

Stock Market Update: A Wild Week of Tariff-Driven Volatility

The U.S. stock market wrapped up a rollercoaster week on April 11, 2025, with major indexes posting gains despite intense volatility sparked by global trade tensions. The S&P 500 climbed 1.8% on Friday, notching its best weekly performance since November 2023, while the Dow Jones Industrial Average and Nasdaq Composite also ended higher, with the latter logging its strongest week since 2022. Yet, beneath the surface, investor anxiety lingers as President Trump’s tariff policies continue to roil markets.

Early in the week, stocks teetered on the edge of a bear market, with the S&P 500 briefly dipping nearly 18% from its mid-February peak. The catalyst? Trump’s aggressive tariffs, including a 145% levy on Chinese imports, met with China’s retaliatory 125% tariffs on U.S. goods. These moves sent shockwaves through global markets, erasing gains from a historic rally midweek when Trump announced a temporary pause on some tariffs. By Thursday, however, stocks slid again as the White House clarified higher-than-expected duties on China, underscoring the unpredictability of the trade war.

Friday’s rebound was fueled by dip-buying and calming remarks from Boston Federal Reserve President Susan Collins, who assured markets the Fed stands ready to stabilize if needed. Still, the bond market flashed warning signs, with Treasury yields spiking and the U.S. dollar weakening, reflecting fears of inflation and economic slowdown. Consumer sentiment also took a hit, with the University of Michigan’s preliminary April survey showing weaker-than-expected confidence, largely tied to tariff-related price hike concerns.

Looking ahead, markets face uncertainty as first-quarter earnings season kicks off, with big banks like JPMorgan Chase under scrutiny. Investors are also eyeing potential Federal Reserve moves, though bets on near-term rate cuts have faded amid rising inflation expectations, now at 4.4% for the next five to ten years. While some see opportunity in the market’s “reset” valuations, others, like Moody’s chief economist Mark Zandi, peg recession odds at 60% for 2025.

For now, Wall Street remains a battleground of fear and opportunity, with tariffs steering the narrative. Stay tuned as we track how these dynamics unfold.