The S&P 500 added over $1.2 trillion in market cap across just two sessions after it opened higher on Monday as traders reacted to news that President Donald Trump may delay parts of his upcoming tariff plan. The rally started Friday and accelerated into Monday.
The S&P 500 surged by 1.7%, the Dow Jones Industrial Average climbed by 502 points, or 1.2%, and the Nasdaq Composite rose 1.8%, according to trading data from CNBC.
The jump came after Trump said there might be “flexibility” in his tariff plans, which were scheduled to begin on April 2. Those comments were made during a short exchange with reporters on Friday.
That single word—“flexibility”—was enough to cool investor panic and lift major averages back into green. Trump’s original tariff announcement raised fears that the U.S. could trigger a global trade war.
The Wall Street Journal reported the final version of Trump’s tariff package is expected to be more narrow than initially outlined and may avoid industry-specific duties.
Bloomberg News reported that certain nations will likely be exempt from the upcoming tariffs. Both reports said the situation remains fluid.
Tesla leads tech rebound as beaten-down stocks rally
Tesla stock jumped more than 7% during Monday’s session after rising 3.6% in premarket trading. It had just come off a brutal stretch of nine straight weekly losses. The bounce pushed its two-day gains to 13%. Tesla wasn’t alone.
Meta rose around 4%, and Nvidia added 1.9%. Advanced Micro Devices was up about 2.7%, also in premarket. Apple, Amazon, and Alphabet also traded higher during the session, contributing to the Nasdaq’s outperformance.
The broader rally in tech came after a rough month. The S&P 500 fell into correction territory in late February and was still sitting 7.8% below its record high by the close of last week.
The Nasdaq Composite had been down for four straight weeks but ended Friday with a small gain. It still remains 12% off its all-time high. Monday’s move helped both indexes recover more ground, but neither has returned to previous levels.
Federal Reserve Chair Jerome Powell also helped stabilize investor nerves last week when he said the negative impact of any tariffs would likely be “short-lived.”
That helped soften some of the damage done by collapsing consumer sentiment, which had shaken confidence in March. A new consumer confidence report is scheduled for Tuesday, followed by initial jobless claims data on Thursday.
Russell 2000 climbs but stays stuck in correction zone
The Russell 2000 index, which tracks small-cap stocks, gained about 2% during Monday’s morning session. That move outpaced the S&P 500’s 1.5% gain. But despite the rally, the Russell 2000 still sits in correction territory—15% below its all-time high from November 2024.
On March 13, the index was down 19% from its November high and just 1% away from entering a full-on bear market, which is defined as a drop of 20% or more. Monday’s move higher was its biggest in weeks, but the index still has a long way to go before escaping its steep decline.
Service-sector data from S&P Global showed surprising strength. Its flash services index for March came in at 54.3, up from 51 in February and ahead of the 51.5 estimate from Dow Jones. But the firm noted that optimism was still weak, with expectations for job growth hitting the second-lowest level since October 2022.
Manufacturing, on the other hand, continued to slide. The flash manufacturing PMI dropped to 49.8 in March, down from 52.7 in February and below the 51.5 forecast. That signals contraction.
“Input price inflation accelerated sharply, especially in manufacturing, to a near two-year high, often attributed to the impact of tariff policies,” S&P Global wrote in the report. “However, competition limited the pass-through of higher costs to selling prices.”
Crypto jumps as Bitcoin hits $87,000 again
Bitcoin reclaimed the $87,000 level on Monday for the first time since the beginning of March. Traders piled back into crypto on hopes that Trump’s tariff plan won’t be as aggressive as originally feared. That optimism pushed crypto-linked stocks higher in premarket trading.
Coinbase and MicroStrategy were each up more than 3% before the market opened. Bitcoin miners Core Scientific, Mara Holdings, and CleanSpark each gained 4%. Bitcoin is still down 6.5% for the year but has climbed 4% in March so far.
The rebound in crypto tracked with gains in equities. Risk appetite returned fast once it looked like Trump might ease up on his tariffs. The deadline for that policy remains April 2, but the White House hasn’t finalized the scope. Tobin Marcus, senior policy and politics strategist at Wolfe Research, wrote in a client note:
“Omitting the sectoral tariffs from the April 2nd package significantly reduces both its aggregate scale and the maximum rate on targeted sectors, given that all of Trump’s tariffs to date have been designed to stack.”
Tobin also said, “The ceiling for reciprocal tariffs on April 2 remains dramatic, and we still expect a negative market reaction, but the scale won’t be as severe, and the sectoral impacts won’t be as concentrated.”
Meanwhile, traders are watching Tuesday’s consumer confidence numbers and Thursday’s jobless claims closely. Any signs of a weakening labor market could erase recent gains. After four weeks of selling, last week’s small win gave the S&P 500 some room to breathe. But it still has ground to cover before it hits new highs.
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This articles is written by : Nermeen Nabil Khear Abdelmalak
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