Stocks were positive but off their session highs Tuesday afternoon as US President Donald Trump’s tariff deadline neared, reports foreign outlet ‘CNBC’.
The S&P 500 added just 0.7 per cent, while the Nasdaq Composite ticked up 0.5 per cent. The Dow Jones Industrial Average gained 448 points, or 1.2 per cent. The major averages lost of their early gains, when the 30-stock Dow had jumped as much as 3.8 per cent, and the S&P 500 and Nasdaq rallied more than 4.0 per cent each.
Hopes rose earlier Tuesday for the US to reach a negotiations that would lower tariffs on major trading partners, CNBC said. Trump posted on Truth Social Tuesday that he had a “great call” with the acting president of South Korea, and that China “also wants to make a deal badly.”
Treasury Secretary Scott Bessent also told CNBC on Tuesday that around 70 countries had approached the US for tariff negotiations. “If they come to the table with solid proposals, I think we can end up with some good deals,” Bessent said. “And part of the calculus of that may be that some part of the tariffs stay on,” read the CNBC report.
Despite talk of deals, however, none appear close to being hatched before Trump’s deadline for just after midnight when the higher reciprocal tariff rates kick in on top of the 10% baseline duty already implemented on Saturday.
The rebound come after three days of steep losses and violent volatility. Monday marked the highest trading volume for US markets in at least 18 years, at roughly 29 billion shares. The 30-stock Dow Jones Industrial Average plunged more than 1,700 points at one point in the session. Between the day’s highs and lows, the index swung 2,595 points. The blue-chip index ultimately closed down by 349 points, or 0.9 per cent.
The S&P 500 briefly entered bear market territory at the lows of Monday’s session, down more than 20 per cent from its record, before rebounding slightly and finishing the session slightly lower. The benchmark lost 10 per cent in two days to end last week, its worst losses since 2020 during the outbreak of Covid, on fears that Trump’s shockingly high tariff rates on most of the world will lead to a recession.
Despite Tuesday’s gains on growing optimism for tariff negotiations, investors will need to see more stability in trade policy for the bounce to have legs, according to Robert Ruggirello, chief investment officer at Brave Eagle Wealth Management.
“There has to be some staying power, something [where] corporations can make longer-term capital allocation decisions. They have to have confidence in a consistent policy,” said Ruggirello.
Several megacap tech stocks were higher on the day. Nvidia and Meta Platforms gained around 3.0 per cent each, while Netflix rose around 2.0 per cent.
Meanwhile, Apple fell 0.6 per cent after an initial rally. The iPhone maker, which is heavily exposed to China, has lost around 19 per cent in the last three trading sessions.
The CBOE Volatility Index — known as Wall Street’s so-called fear gauge — spiked to about 60 on Monday, an extreme level that could signal a technical bounce was due. On Tuesday, it flickered around 40.
