Donald Trump has a unique ability to sway market reactions with just a few words. A single post on Truth Social can send traders scrambling, either celebrating or seeking safety. His recent commitment to impose 100% tariffs on Chinese exports stirred significant concern on Friday, contributing to the largest weekly drops for the S&P 500 and Nasdaq in several months. However, by Monday morning, the mood shifted following his assurance that “everything will be fine,” resulting in a surge in Wall Street futures and almost a collective sigh of relief from investors.
It’s quite something to witness how one individual can create such dramatic market fluctuations with seemingly simple communication. One day, he poses threats to global supply chains; the next, he insists that he doesn’t intend to damage China. As a result, futures traded smoothly—Dow rose 0.7%, S&P 500 gained 1.1%, and Nasdaq climbed 1.6%. It seems emotions—often an unseen force—have become more influential than actual tariffs.
Last Friday, investors offloaded various stocks, whether left-wing, right-wing, or centered ones, in favor of more defensive options after the U.S. response to China’s export restrictions on rare earth elements were made public. The Nasdaq 100 suffered the most, ending the day down 3.49%.
This push and pull between threat and reassurance is emblematic of today’s economic environment. China has tightened its export controls on rare earths, vital for semiconductor production, pointing fingers at the U.S. for escalating tensions, yet refraining from further retaliation. A potential meeting between Trump and his Chinese counterpart is slated for later this month, but whether it happens remains uncertain. The outcome seems to hinge more on Trump’s mood than on any diplomatic schedule.
At the same time, the U.S. government has entered its 13th day of shutdown, delaying the release of essential economic indicators. This has led the market to closely analyze every nuance in presidential remarks, interpreting them almost like hints in a fortune-telling session. Many traders now view Trump’s social media posts as crucial indicators, overshadowing traditional metrics like payroll statistics or inflation rates.
Despite the surface-level drama, the underlying economy presses on. This week marks the arrival of third-quarter earnings reports, starting with major banks like JPMorgan, Goldman Sachs, Citigroup, and Wells Fargo. Analysts anticipate an earnings growth of about 8.8% year-over-year—still a solid figure, albeit a dip from the previous quarter’s 13.8%. Given the delays in government data, corporate earnings are becoming a more reliable gauge of economic health than anything the administration has to say.
Ultimately, there remains a thread of optimism. Enthusiasm surrounding AI developments and the prospect of lower interest rates continue to support market confidence, prompting investors to regard the latest trade tensions as temporary gusts rather than storm systems. Semiconductor stocks exemplified this pattern; Nvidia and its competitors fell on Friday due to tariff fears but saw their values rebound on Monday when Trump’s more conciliatory posts surfaced. There was no real repositioning in the supply chain during that brief period—only shifting expectations.
Following Trump’s tariff announcement on Friday, U.S. rare earth mining companies unexpectedly gained attention, with Critical Metals shares up over 19%, U.S. Rare Earths rising by 23%, and MP Materials increasing nearly 8%.
The tech sector was expected to find its footing again on Monday. Qualcomm faced a tricky situation as the Chinese government announced that it had not informed regulators about its June acquisition of Israeli company Autotalks. The backlash was immediate, leading to an antitrust probe and a 7.3% dip in Qualcomm’s stock. The day promised a careful reopening for the chip sector, with traders intensely monitoring both price trends and regulatory sentiment across the Pacific. Disruptions due to policy changes are now felt as acutely as revenue figures.
Beyond tech, corporate actions on Monday displayed a blend of ambition, legal challenges, and strategic adjustments. ExxonMobil’s CEO warned about potential tightening in oil markets without new investments, especially in unconventional resources. Warner Bros. Discovery turned down a takeover offer from Paramount Skydance as inadequate, while JPMorgan unveiled a $1.5 trillion investment initiative aimed at bolstering U.S. defense, energy, and advanced manufacturing sectors. Additionally, Blackstone sold its UK logistics assets to Tritax Big Box for £1.04 billion and is contemplating a possible acquisition by Big Yellow Group.
In other markets, gold and silver prices climbed to record highs amid renewed trade tensions before calming as geopolitical risks eased. Crude oil prices saw a slight uptick, while the dollar experienced a minor dip.
Going over analyst reports that morning, I noticed their careful choice of words. Terms like “likely,” “depends,” and “should” were prevalent, reflecting a market grappling with uncertain futures and the whims of presidential sentiment. Their comments felt more like hedging than solid predictions.
Looking at the broader economic agenda, the government shutdown continues to hamper the release of U.S. economic data. The Bureau of Labor Statistics has rescheduled the Consumer Price Index (CPI) for September from this week to October 24. No further releases will be made until regular government operations resume. A few central bankers, including Federal Reserve Chair Jerome Powell, are set to speak this week.
In the Asia-Pacific region, markets fell today in response to renewed trade tensions between the U.S. and China. Hong Kong dropped 2.6%, while South Korea and Taiwan fell more than 1%. Australia’s index declined by 0.8%, and India’s dropped 0.3%. Japan is closed for a public holiday. Mixed performance was seen among European stock indexes, with Stoxx Europe 600 edging up by 0.2%. The VIX index, a measure of market anxiety, surpassed the 20-point threshold for the first time since early August.
Today’s economic highlights:
- Dollar index: 99,240
- Gold: $4,080
- Crude oil (Brent crude): $63.12 (WTI: $59.31)
- USA 10-year yield: 4.05%
- Bitcoin: $114,540
In corporate news:
- Blackstone confirmed its interest in acquiring Big Yellow while selling its UK logistics assets to Tritax Big Box for £1.04bn.
- ExxonMobil’s CEO cautioned about tightening oil markets due to declining non-traditional investments.
- SystImmune received a $250 million milestone payment from Bristol-Myers Squibb, with potential earnings reaching up to $7.1 billion from their collaboration on cancer treatments.
- Strava is planning an IPO in the U.S. to fund a potential acquisition.
- Caterpillar announced its acquisition of mining software company RPMGlobal, with the deal expected to finalize in early 2026.
- Regeneron showed promising results in a trial for its gene therapy aimed at severe inherited hearing loss.
- London Stock Exchange Group is expanding its partnership with Microsoft for AI-driven financial insights.
- Moderna intends to present favorable early results for its mRNA-4359 cancer therapy during ESMO.
- Collaboration between Bristol-Myers Squibb and Moderna will showcase manageable safety profiles for cancer patients during ESMO.
- Johnson & Johnson and Legend Biotech’s Carvicti cancer drug received a new label warning from the FDA regarding serious risks.
- Pharmaceutical companies including AbbVie and Pfizer announced direct-to-consumer drug sales and price reductions in response to governmental pressures.
- Jefferies reported minimal exposure to bankrupt auto parts supplier First Brands, marking an impact on its market valuation.
- China’s SAMR stated its investigation into Qualcomm’s Autotalks acquisition is routine antitrust enforcement.
- India’s aviation regulator instructed Air India to inspect its emergency power systems following technical difficulties on its 787s.
- China’s auto market grew 6.6% in September, though BYD saw its first monthly sales decline since early 2024.
- Tabby has invested in Nvidia HGX systems to advance its AI infrastructure.
- CVS and UnitedHealth scored well in the U.S. 2026 quality evaluation, qualifying for significant government bonuses.
Analyst recommendations:
- AMD (Advanced Micro Devices): KGI Securities raised its price target from USD 150 to USD 260 and upgraded to Outperform from Neutral.
- APA Corporation: Evercore ISI maintains an inline rating, hiking the price target from $16 to $21.
- Bloom Energy Corporation: Baird maintains Outperform and raises the price target to $94 from $76.
- Cleveland-Cliffs: JPMorgan keeps a Neutral rating and raises the price target from $10 to $13.
- Comfort Systems USA, Inc.: Stifel has a buy rating while increasing the target from $746 to $917.
- Fiserv, Inc.: Goldman Sachs maintains a buy rating but reduces its price target from $192 to $149.
- Mid-America Apartment Community, Inc.: Wolfe Research keeps an Underperform rating, lowering its target from $152 to $121.
- MCS Inc.: Morgan Stanley maintains an overweight rating while raising the price target from $120 to $151.
- Robert Half Inc.: BMO Capital Markets maintains a market performance recommendation but cuts its target from $47 to $36.
- Rocket Lab Corporation: Morgan Stanley keeps an equal recommendation while raising its price target to $68 from $20.
- Sandisk Corporation: Wells Fargo maintains equal weight and raises its target from $50 to $115.
