The US stock market was shut down with solid profits as traders thought that President Trump’s trade war with China could cool off.
The market rose in the morning, but actually gained momentum Tuesday afternoon after several media outlets revealed comments from Treasury Secretary Scott Bescent.
“I don’t think the current situation is sustainable,” Bessent said at an event hosted by JPMorgan Chase, according to multiple reports.
White House spokesman Caroline Leavitt declined to elaborate on those comments during a briefing Tuesday, but she said the administration is “doing very well in terms of a potential trade deal with China.”
“The president and the administration are setting the stage for dealings with China,” Leavitt said. “So we feel that everyone involved wants to see a trade deal happening and the ball is moving in the right direction.”
The rebound concludes another wild stretch of two days on the stock market. This was closed at loss Monday amid Trump’s continued attacks with the Fed. All three major indices lost about 2.5% on Monday, but all escalated US bond and dollar selling.
But a day later, the index made up for some of these losses. The Dow Jones industrial average rose 1,016 points (2.66%), while the high-tech Nasdaq rose 429 points (2.71%). The S&P 500 index rose 2.5%.
The market fell on Monday as Trump bolstered his criticism of Federal Reserve Chairman Jerome Powell.
Trump called Powell a “major loser” on Monday, suggesting that the Fed’s previous interest rate cuts aimed at supporting former President Biden.
The president retreated on Tuesday and said he had no intention of firing Powell.
The International Monetary Fund (IMF) also significantly reduced growth forecasts for both the US and the global economy, pointing to Trump’s sudden new tariffs.
However, the Dour IMF outlook did not appear to make waves on Wall Street. There, more attention was paid to Bescent’s positive statement behind the locked room.
