90-Day Tariff Pause Sparks False Hope for 15 Minutes: Can It Reveal a Glimmer of Hope for U.S. Stocks?

TradingKey - On April 7, 2025, global markets suffered a "Black Monday," but U.S. equities briefly rallied amid a false report suggesting a  "90-day tariff pause." The Nasdaq Composite and semiconductor indices, which had been battered earlier in the day, ultimately closed in positive territory.

Roughly 30 minutes after the U.S. stock market opened, major indices surged: the S&P 500 jumped as much as 3.35%, while the Nasdaq Composite climbed 4.33%. However, the rally quickly reversed within about 15 minutes. The brief spike was triggered by a misleading report indicating that President Donald Trump was considering suspending tariffs for certain countries for 90 days.

The confusion originated when Walter Bloomberg, an X (formerly Twitter) user with 850,000 followers, unaffiliated with Bloomberg, posted that Kevin Hassett, Director of the White House National Economic Council, had said Trump was contemplating a 90-day tariff suspension.  The post was quickly picked up by CNBC and Reuters, spreading optimism across Wall Street that the tariff tensions might ease. As a result, the three major U.S. indices spiked.

However, the White House promptly denied the claim, confirming the report was false. Markets swiftly erased their gains. A New York Stock Exchange trader noted that once investors realized the headline was inaccurate, selling resumed across the board. "This is madness," Peter Tuchman said.

Despite the retraction, the renewed selling did not intensify. U.S. indices avoided the steep declines seen earlier in the day in Japan’s Nikkei, Hong Kong’s Hang Seng, or European markets earlier in the day.

The Wall Street Journal described the incident as a "live test" of how markets might react to genuine triggers for a rebound. The asymmetry in market movements—  before and after the correction—suggested that buyers were on standby, while panic-driven liquidation had largely subsided.

Art Hogan, Chief Market Strategist at B. Riley Wealth Management, remarked, "That was a good example of what would happen if we actually got some rational thought mixed in with the ignorant tariff policy."

As U.S. stocks continued to tumble, with the S&P 500 briefly entering bear market territory, voices advocating for buying the dip in U.S. equities began to emerge.

BlackRock CEO, Larry Fink, stated that although economic anxiety was at its most severe in recent memory—prompting investors to dump risk assets—this moment could represent a long-term buying opportunity. He emphasized that there was no evidence of systemic risk.

Meanwhile, subtle signs emerged that President Trump might be softening his hardline tariff stance. Although he has repeatedly insisted he would not roll back tariffs, he hinted at openness to “friendly negotiations” following a phone call with Japanese Prime Minister Shigeru Ishiba overnight.