President Trump’s trade wars have been the single biggest event that has been affecting global markets in the last 3 months. It initially started with Trump slapping tariffs on multiple countries and eventually culminated into a China-U.S. trade war.
Well, market participants have been waiting for signs of that trade war cooling down, and Trump may have just confirmed that. The U.S president’s recent comments confirmed plans to hold talks with China’s President Xi Jinping.
The U.S President also acknowledged that the tariffs against China were quite high and revealed plans to lower them.
Trump’s comments marked the first time that the U.S president has adopted a softer stance against China since the trade wars began. An about turn, which many analysts see as a sign that the West is caving to the economic pressures that came as a result of the tariff wars.
The stock market bounces back as Trump’s comments boost confidence
The tariff wars had a negative and massive impact on the stock market, as evident by its sharp decline over the last 3 months. For context, the S&P 500 peaked at 6,140 and tanked as low as 4,980 earlier this month.
The stock market initially saw some recovery after Trump’s initial pullback on tariffs against most countries. This was reportedly after multiple countries agreed to hold negotiations in a move Trump termed as “The art of the deal.” However, China was exempted, and things got heated up between the two countries. This was the reason why the S&P 500 continued sliding lower between 9 April and 21 April.
The S&P500 bounced back from 5,160 to 5,290 in the last 3 days. This recovery was consistent with the market sentiment shift after Trump announced that he was willing to play ball with China.
The liquidity pumps back into the crypto market
The crypto market fared much better than the stock market, and the same goes for its recovery. The total crypto marketcap bounced back by over 6.2% in the last 24 hours, which marked one of its most bullish days so far in 2025.
Trump’s statements fueled a massive shift in sentiment. The fear and greed sentiment bounced back into greed territory for the first time in since February.
Bitcoin benefited immensely from this sentiment shift. Its price bounced by 6.83% on Tuesday as the bulls pushed prices as high as $93,928. Analysts remained optimistic about a recovery in the market courtesy of growing prospects of lower interest rates.
