Markets Rebound After Sharp Drop Amid Trump Trade Worries/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ U.S. stocks rebounded Tuesday after steep losses driven by trade war concerns. Stabilized bond yields and dollar values helped soothe market jitters. Strong corporate earnings lifted investor sentiment despite ongoing uncertainties.
Wall Street Rebounds: Quick Looks
- Market Rebound: U.S. stocks rose Tuesday, recouping part of Monday’s sharp losses.
- Earnings Boost: Positive Q1 earnings from 3M, PulteGroup, and Boeing lifted indexes.
- Dollar Stabilizes: The U.S. dollar steadied after recent declines against major currencies.
- Bonds Find Balance: Treasury yields leveled off following sharp swings tied to policy fears.
- Gold & Yen Climb: Safe-haven assets like gold and the Japanese yen continued to gain.
- Tariff Anxiety Lingers: Uncertainty around Trump’s tariffs still weighs on investor confidence.
- Tesla Edges Up: Shares rose 1.7% ahead of Q1 earnings; losses for the year trimmed.
- Winners & Losers: First Solar soared on solar tariff news; Kimberly-Clark fell on cost concerns.
Markets Rebound After Sharp Drop Amid Trump Trade Worries
Deep Look
Wall Street bounced back on Tuesday after suffering its steepest losses in weeks, with investors encouraged by stronger-than-expected corporate earnings and signs of stabilization in key financial markets.
The S&P 500 rose 1%, reclaiming some of the ground lost Monday amid mounting investor anxiety over President Donald Trump’s trade policies and continued attacks on Federal Reserve Chair Jerome Powell. The Dow Jones Industrial Average added 417 points (1.1%), while the Nasdaq Composite climbed 1.1%.
The market’s mood was further soothed by steadier performance from the U.S. dollar and Treasury bonds, both of which had seen uncharacteristically sharp declines the day before. Those moves had sparked fears that confidence in traditionally safe U.S. assets was eroding.
Despite some lingering unease — evident in the continued rise of gold and the Japanese yen — investors focused on better-than-expected earnings reports to push stocks higher.
Earnings Drive Optimism
- 3M surged 4.7% after beating quarterly earnings expectations and reaffirming its 2025 forecast despite tariff headwinds, which it warned could shave up to $0.40 per share off earnings.
- PulteGroup jumped 5% following strong results, helped by falling mortgage rates triggered by recent Treasury yield dips.
- Boeing gained 1.7% after announcing a $10.55 billion sale of its Jeppesen and digital aviation services to Thoma Bravo.
- Tesla added 1.7% ahead of its quarterly earnings release. Though first-quarter sales fell 13%, investor focus shifted to broader company strategy amid political backlash tied to Elon Musk’s White House role.
Trade Policy Turmoil
The broader market recovery comes even as Trump’s trade war rhetoric continues to stoke volatility. While tariffs threaten to disrupt global supply chains, they also create potential winners:
- First Solar surged 8.5% after the U.S. Department of Commerce finalized tariffs on some Southeast Asian solar manufacturers, potentially giving the U.S. company a competitive edge.
- Kimberly-Clark dropped 3% despite a profit beat, with the company citing unexpectedly high global supply chain costs driven by tariffs.
CEO Mike Hsu noted, “The current environment will now mean greater costs across our global supply chain than what we expected,” prompting a downward revision of its earnings guidance.
Market Metrics
- The 10-year Treasury yield eased slightly to 4.37%, after closing Monday at 4.42%, indicating some return to investor confidence in U.S. bonds.
- In international markets, stock movements were modest across Europe and Asia, reflecting a cautious but more stable global outlook.
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