Monday | April 14, 2025
US stocks surged Monday morning as investors cheered the Trump administration’s move to exempt smartphones, computers, and other electronics imported from China from new tariffs. The announcement sparked renewed confidence in the tech sector and broader equity markets, even as uncertainty over US trade policy continued to loom.
The Dow Jones Industrial Average jumped 480 points, or 1.2%, while the S&P 500 climbed 1.75%. The Nasdaq Composite, which is heavily weighted toward technology stocks, led the gains with a 2.4% increase, fueled by strong performances from tech giants like Apple.
Stock futures had already begun to climb over the weekend, after investors learned that the US Customs and Border Protection agency had quietly posted a notice late Friday outlining the tariff exemptions. The exemptions, which took effect immediately, helped ease some of the tension surrounding President Donald Trump’s aggressive new trade policies.
Just days earlier, Trump had announced sweeping 145% tariffs on a wide range of Chinese imports, sparking fears of a deeper escalation in the ongoing US-China trade war. However, the exemptions for electronics — critical for both US consumers and major corporations — signaled a potential softening, at least temporarily, in Washington’s stance.
Still, the relief may be short-lived. Speaking Sunday on ABC News, Commerce Secretary Howard Lutnick clarified that the electronics exemptions are only temporary. According to Lutnick, while these goods are exempt from the so-called “reciprocal tariffs”, they will fall under separate levies as part of forthcoming semiconductor-specific tariffs, expected to be implemented within the next one to two months.
“Electronics are exempt from the reciprocal tariffs, but they’re included in the semiconductor tariffs, which are coming in probably a month or two,” Lutnick explained.
The exemptions also do not apply to a separate 20% tariff levied on Chinese imports in connection with the country’s alleged role in the fentanyl trade, which the Trump administration has linked to the ongoing opioid crisis in the US.
Markets have been volatile over the past two weeks, reacting to a series of abrupt policy announcements from the White House. The S&P 500 fell 9% in the first week of April — marking its worst week since 2020 — as investors digested the implications of Trump’s new “reciprocal tariffs.” However, the index rebounded 5.7% last week, posting its best weekly gain since 2023, after Trump declared a 90-day pause on most of the reciprocal tariffs.
In fact, the market rallied so sharply on Wednesday following Trump’s pause announcement that it recorded the third-largest single-day gain in modern history. Still, despite the dramatic swings, the S&P 500 remains below its April 2 closing level — the day before Trump’s initial tariff announcement.
As Wall Street eyes the start of earnings season and continues to navigate global headwinds, analysts warn that the path forward remains murky.
“While any delay of tariffs is beneficial on the margin, it is not the same as their removal,” analysts at Morgan Stanley wrote in a note to clients on Friday. “History suggests that elevated and prolonged uncertainty that weighs on business confidence can have detrimental effects on business spending and hiring.”
Investors and corporate leaders alike are closely monitoring future developments from Washington, particularly as the timeline and scope of additional tariffs — such as those on semiconductors — remain unclear.
For now, Monday’s gains offer a temporary reprieve from the roller-coaster ride that markets have endured in April. But with the Trump administration’s trade strategy in flux, and fresh tariffs potentially just weeks away, the calm may not last long.
While Wall Street found some temporary relief in Monday’s market rally, growing concerns about the broader economy and the long-term implications of US trade policy are weighing heavily on investors and analysts alike.
In an earnings press release Monday, Goldman Sachs CEO David Solomon acknowledged the shifting economic landscape, describing it as a “markedly different operating environment than earlier this year.” His remarks underscore the rapid deterioration in investor sentiment since the beginning of 2025, as businesses and markets grapple with the fallout from escalating trade tensions and inconsistent policy direction.
Adding to the anxiety, billionaire investor and Bridgewater Associates founder Ray Dalio issued a stark warning over the weekend. In an interview with NBC News, Dalio said the Trump administration’s sweeping tariffs have already done significant damage to the US economy and may be steering the country toward a recession — or worse.
“Right now, we are at a decision-making point and very close to a recession,” Dalio said. “And I’m worried about something worse than a recession if this isn’t handled well.”
His comments echoed a growing sense of unease among economists and market strategists who have watched business confidence and consumer sentiment weaken in recent months.
Reflecting this shift in sentiment, analysts at Citi on Friday lowered their year-end target for the S&P 500 to 5,800, down from a previous forecast of 6,500. Citi joins a widening chorus of Wall Street institutions slashing their outlooks for both corporate earnings and economic growth amid what it called an “uncertain tariff environment.”
“No doubt, the Goldilocks sentiment in place entering this year has given way to abject uncertainty,” the bank’s analysts wrote, referencing the previously favorable conditions of low inflation, strong earnings, and moderate growth that defined early 2025.
As risk appetite declines, investors have turned to traditional safe havens — none more so than gold, which has experienced a dramatic rally this year. On Friday, gold prices surged past a record $3,200 per troy ounce, bringing year-to-date gains to more than 21%. The metal’s rally reflects escalating investor fears around inflation, geopolitical instability, and monetary policy uncertainty.
Recognizing the strong momentum and growing demand for bullion, Goldman Sachs on Friday raised its year-end forecast for gold to $3,700 per ounce, citing continued market volatility and a flight to safety.
“Gold is behaving exactly as it should in times like these,” one Goldman analyst noted. “It’s a hedge against both inflation and instability — and right now, investors are looking to protect rather than grow.”
As earnings season kicks into gear and policymakers navigate a volatile global backdrop, all eyes will remain on Washington and the Federal Reserve. With mixed signals from the White House and mounting pressure on central banks to respond, markets are likely to remain on edge in the weeks ahead.
