Stock Rebound Continues Despite Trade War Fears – US Market Wrap

The great Wall Street rebound resumed in earnest, with stocks rallying late in the day, despite growing concerns that the US economy will buckle under the weight of Trump’s trade war.

A month of historic volatility ended on the same note, with the S&P 500 reversing a 2% decline for the first time since 2022. After a report that the US has been proactively reaching out to China through various channels, hopes for constructive trade talks grew. At the same time, a group of investors believes the Federal Reserve will use its policy medicine to prevent a recession.

Wild swings lashed US assets throughout the month as Trump’s rapidly evolving tariff war pushed the S&P 500 to the brink of a bear market, with a nearly 20% drop from its February record through April 8. The gauge reversed about half of that slide, but it still saw its third month of declines, the longest losing streak since 2023.

Following a few chaotic days in early April that raised fears that foreign investors were fleeing American assets, Treasuries rebounded and posted their fourth consecutive month of gains. The dollar experienced its worst month since November 2022.

The macro picture remained in the spotlight ahead of results from a pair of megacaps. In the late hours, Microsoft and Meta Platforms reported higher-than-expected sales, indicating that tariffs and broader economic uncertainty have not hampered customer demand.