Trump's 2025 Trade Policy: Impact Analysis from Tariff Shocks to U.S. Stock Market Rebound

Taiwan • Business • 05/09 13:30
Trump's 2025 Trade Policy: Impact Analysis from Tariff Shocks to U.S. Stock Market Rebound

In the spring of 2025, President Trump of the United States announced the "Liberation Day" tariff initiative, imposing a 145% tariff on goods from China, which caused market turmoil. Subsequently, Trump suggested a potential reduction in tariffs and secured a trade agreement with the United Kingdom, leading to a rebound in the U.S. stock market. The timing of these policy actions and market reactions offers a concrete example of the interaction between policy and the stock market.

Key Updates

05/10 15:02

Donald Trump's new tariff policies spark volatility in the U.S. Treasury bond market: 30-year Treasury yield jumps 50 basis points within a week

In April 2025, the U.S. Treasury bond market experienced significant volatility due to a new round of high tariff policy announced by Trump on April 2. The 30-year Treasury yield surged nearly 50 basis points in a single week, marking the largest increase since 1987. Perry, the manager of SOMA at the New York Federal Reserve Bank, pointed out that the large-scale closing of "swap spread trades" by leveraged investors was one of the primary reasons for the abnormal spike in yields. The Trump administration subsequently delayed some of the tariff measures, and the Federal Reserve increased liquidity support to stabilize the market.

05/10 11:29

Sino-American trade talks in Geneva halted: Chinese delegation abruptly withdrew from the venue

On May 10, 2025, high-level economic and trade negotiations between the US and China were held in Geneva, Switzerland. The Chinese delegation abruptly left the venue, causing the talks to be interrupted, and the US representatives subsequently left as well. This meeting marked the first formal engagement between the two sides since the escalation of high-tariff tensions, aimed at finding a way to ease tensions. Both parties had previously expressed openness to dialogue, but the sudden turn of events cast doubt on the future of the negotiations.

05/10 07:29

Impact of Trump's 2025 Tariff Policy on U.S. Supermarkets: Costco's Five Major Imported Food Prices Face Pressure

In April 2025, President Trump of the United States announced the imposition of a minimum tariff of at least 10% on all imported goods, and punitive tariffs of up to 145% on products from specific countries, leading to global trade upheaval. This policy is intended to revitalize American manufacturing but has triggered price fluctuations in the U.S. retail market. Five key categories of imported foods at Costco—grains, coffee, wine, cheese, and cooking oil—have been severely impacted, resulting in price increases. This article examines the specific effects on these products and the market's reaction.

05/10 02:00

The US-UK Trade Agreement and the US-China Negotiations Boost Market: Oil Prices and Tesla Stock Rise, and Gold Climbs Due to a Weakened Dollar

On May 10, 2025, US-China high-level trade negotiations took place in Geneva, and the US and UK reached a bilateral trade agreement, enhancing market confidence. Oil prices rose, driven by trade optimism and Middle Eastern tensions, while Tesla's stock price rebounded thanks to tariff reductions and advancements in its self-driving taxi program. Gold prices rose due to the weakening dollar and geopolitical risks. This article examines how these events affect oil prices, Tesla's stock price, and gold prices.

05/09 22:31

Adafruit, a New York electronics company, announced a price increase due to a $36,000 tariff burden.

Adafruit Industries, an electronics hardware company based in New York City, USA, announced it will raise prices on some products due to receiving an import duty bill totaling $36,126.46. This cost arises from the high tariff policies imposed by the United States on China and other countries, with a tax rate of 145% specifically applied to Chinese products. Adafruit stated that this is putting pressure on their cash flow and may result in unsold inventory. This situation highlights the operational challenges American companies face under the current trade policies.

05/09 13:30

Trump's 2025 Trade Policy: Impact Analysis from Tariff Shocks to U.S. Stock Market Rebound

In the spring of 2025, President Trump of the United States announced the "Liberation Day" tariff initiative, imposing a 145% tariff on goods from China, which caused market turmoil. Subsequently, Trump suggested a potential reduction in tariffs and secured a trade agreement with the United Kingdom, leading to a rebound in the U.S. stock market. The timing of these policy actions and market reactions offers a concrete example of the interaction between policy and the stock market.

05/09 10:31

The Impact of Trump's Tariff Policy on American Family Farmers: Farmers Facing Shrinking Export Markets and the Risk of Bankruptcy

Family farms in the agricultural heartland of the United States are under pressure due to the tariff policies of President Trump, especially the high tariffs on China that are impacting agricultural exports. Even though the government claims these measures will result in fairer trade, farmers are dealing with shrinking export markets, declining prices, and a rise in bankruptcies. The article examines the impact of these policies on family farms by analyzing farmers' experiences and data.

05/09 09:03

By 2025, China-US trade is projected to decrease by 2.1%, and the throughput at US West Coast ports is expected to drop by 30% in May.

Since early 2025, China-US trade has been under continuous pressure, with a total trade value of 1.44 trillion yuan from January to April, a 2.1% decrease compared to the same period last year. Container throughput at the Los Angeles and Long Beach ports is expected to drop by 30% in May, due to importers stocking up early, weak demand, and changes in tariff policies. US imports surged by 9.1% in April, but demand plummeted in May. These figures indicate a significant slowdown in China-US trade and logistics activities.

05/09 07:30

President Trump of the United States announced a trade agreement between the US and the UK, suggested imposing high tariffs on imported semiconductors, and criticized the policies of his predecessors.

On May 8, 2025, President Trump of the United States announced at the White House that he had reached a historic trade agreement with the United Kingdom, covering industries like automobiles, steel and aluminum, agriculture, and aerospace. This marks the first major trade agreement of Trump's second term. Trump criticized the former president for allowing chip production to be outsourced to Taiwan and hinted at possibly imposing tariffs ranging from 50% to 100% on imported chips. He emphasized that the U.S. is drawing major chip companies back, investing billions of dollars, and maintaining a strong tariff policy against other countries.

05/09 05:02

Trump Considers Significantly Lowering Tariffs on Chinese Goods to Between 50% and 54%: Markets Closely Watching Ahead of US-China Trade Talks

President Trump of the United States is considering reducing tariffs on Chinese imports from 145% to a range of 50% to 54%. This move coincides with trade negotiations between high-level U.S. and Chinese officials in Switzerland from May 9 to 12. The White House stressed that the final decision is yet to be made and will be personally announced by the President. Markets and industries are closely watching the impact of this policy change on the global supply chain.

April 2: "Liberation Day" Tariff Announcement, Market Plummets

On April 2, 2025, the Trump administration announced the implementation of the "Liberation Day" tariff plan, imposing tariffs as high as 145% on most Chinese imports and an additional 25% on imports from countries such as Canada and Mexico. This move marked a significant shift in trade policy during Trump's second term.

Following the announcement, global markets reacted swiftly. According to reports from CNN and CNBC, U.S. stock index futures fell sharply, with S&P 500 futures dropping 3.9%, Dow Jones Industrial Average futures down 2.7%, and Nasdaq 100 futures plunging 4.7%. Asian and European markets also declined, with Japan's Nikkei 225 index down 2.8% and Germany's DAX index down 3.1%.

April 3 to April 6: Continued Market Decline, Trump and Treasury Secretary's Remarks Fail to Stabilize Sentiment

On April 3, U.S. Treasury Secretary Scott Bessent urged countries "not to retaliate," but the market showed no signs of stabilizing. Trump stated on April 6 that the tariffs "are in effect, and it's a beautiful thing," yet U.S. stocks continued to fall that day.

According to reports from Wikipedia and Yahoo Finance, market confidence remained low during this period. Federal Reserve Chairman Jerome Powell announced on April 7 that interest rates would remain unchanged, citing high uncertainty brought by the tariff policy. Trump further exacerbated market volatility by criticizing Powell as a "fool" on Truth Social on April 8.

April 8: Market Rebounds as Trump Hints at Possible Tariff Adjustments

On April 8, Trump posted on social media, "We know tariffs will be lowered," and hinted that negotiations with China would begin over the weekend. This statement boosted market sentiment, with the S&P 500 rising 9.52% that day, marking the largest single-day gain since 2008, and the Dow Jones surging 2,900 points.

According to CNBC and The New York Times, although analysts warned that the market reaction was overly optimistic, investors generally interpreted it as a signal that the trade war might cool down.

May 8: US-UK Trade Agreement Announced, Trump Urges "Buy Stocks Now"

On May 8, Trump announced a "major" trade agreement with the UK at the White House, which included the UK removing non-tariff barriers on U.S. agricultural products and committing to expanding the U.S. export market. During the press conference, Trump said, "You better buy stocks now; this country is going to rocket up."

On that day, U.S. stocks rose across the board. The S&P 500 increased by 0.6%, the Dow Jones Industrial Average rose by 254 points (0.6%), and the Nasdaq index climbed 1.1%. According to Yahoo Finance and CBS News, expectations for more future trade agreements boosted investor confidence.

May 9: On the Eve of US-China Negotiations, Trump Releases More Optimistic Signals

On May 9, Trump posted on Truth Social, "80% of China's tariffs seem reasonable," and mentioned "many trade agreements are underway, all good (even great) deals." The market rose again, with the Dow Jones up 0.2%, the S&P 500 up 0.4%, and the Nasdaq up 0.5%.

On the same day, Bitcoin prices surpassed $104,000, and gold prices fell by 2%, indicating increased investor risk appetite. According to Yahoo Finance, Treasury Secretary Bessent will head to Geneva for talks with Chinese officials before the weekend, with the market closely watching for concrete progress on tariff reductions.

Key Timeline Summary

DateEventMarket Reaction
April 2"Liberation Day" tariffs announced, 145% tariffs on Chinese goodsU.S. stock futures plummeted, global markets fell
April 3 to April 6Treasury Secretary and Trump's remarks failed to stabilize the marketU.S. stocks continued to fall, Fed kept interest rates unchanged
April 8Trump hinted at tariff reductionsS&P 500 rose 9.52%, Dow surged 2,900 points
May 8US-UK trade agreement announced, Trump urged "buy stocks"S&P 500 and Dow rose 0.6%, Nasdaq rose 1.1%
May 9Trump released more optimistic signals about tariff reductions, previewing US-China talksU.S. stocks rose slightly, Bitcoin and oil rose, gold fell

References

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