Donald Trump’s representatives stated that the upcoming tariffs are likely to be more narrow than initially planned. This can become a short-term bullish signal for the stock market gripped by anxiety over a full-scale tariff war.
Trump is preparing his April 2 “Liberation day” tariff announcement, introducing so-called reciprocal tariffs, which he considers retaliation for duties and barriers of other countries, including long-term US allies. Although the announcement will be a significant expansion of US tariffs, they will be more targeted than the wide-ranging global effort that Trump previously stated.
According to the officials, Trump will announce the imposition of reciprocal duties on countries or blocs, but he intends to exclude some of them, and the US administration does not plan to impose additional sectoral tariffs announced earlier.
Just like with many political processes under Trump, the situation remains unstable, and no decision is final until stated by the president.
Market reaction to the initial duties on Canada, Mexico and China had a strong impact on Trump’s economic advisers, who were using major stock indexes, including S&P 500, as a measure of success for a long time.
The officials have publicly admitted in recent days that the measures may not be so broad, and that other existing tariffs, such as those on steel, may not necessarily be cumulative, and it would significantly reduce the blow to sectors.
It means Trump is shifting from his original plan of universal tariff with a fixed rate, which later transformed into his “reciprocal” offer.
The “Liberation day” announcement may also include some tariff rollbacks, although it is still not clear. Trump imposed and then withdrew tariffs on Canada and Mexico. The status of these tariffs remains unclear, since Trump’s pause on some of the duties is set to expire, and the tariffs could be eliminated. Last week, US Treasury Secretary Scott Bessent stated the duties on steel and aluminum would not necessarily add to existing trade tariffs.
The overall recommendation is to buy S&P 500.
Profits should be taken at the level of 5,930.0. A Stop loss could be set at the level of 5,580.0.
The volume of the opened position should be set in such a way that the value of a possible loss, fixed with the help of a protective Stop loss order, is no more than 1% of your deposit funds.
This content is for informational purposes only and is not intended to be investing advice.
