In the news of May 3, 2025, the US stock market continued its upward trend on Friday, with the S&P 500 index rising for the ninth consecutive trading day, marking the longest streak since 2004 and recovering all losses since President Trump announced global tariff policies in early April. Boosted by better-than-expected April US employment data and expectations of easing tensions in US-China trade relations, the market sentiment is quickly warming up.
This rebound not only signifies Wall Street’s confidence in the fundamentals of the US economy but also indicates that the market is starting to believe that the most severe impacts may have passed.
Earlier, President Trump announced a 10% “benchmark tariff” on all imported goods and imposed “counter tariffs” on dozens of trading partners globally, leading to a sharp decline of up to 15% in major stock indices on Wall Street within days, causing significant volatility in global markets.
Subsequently, with the implementation of the counter tariffs delayed for 90 days, trade tensions have eased, and global stock markets have generally stabilized. With the labor market remaining steady and employment data surpassing expectations, some investors are starting to believe that policy uncertainties may gradually dissipate.
At the close on Friday, the S&P 500 index rose by 82.53 points to 5,686.67 points, a gain of 1.47%. The Nasdaq Composite Index rose by 266.99 points to 17,977.73 points, a gain of 1.51%. The Dow Jones Industrial Average rose by 564.47 points to 41,317.43 points, an increase of 1.39%.
Both the S&P 500 index and the Nasdaq Composite Index have fully recovered all losses since the escalation of the trade war in early April.
About 90% of stocks in the S&P 500 index saw gains, covering all industry categories. The technology sector performed particularly well, with Microsoft rising by 2.3% and Nvidia by 2.5%. However, Apple fell by 3.7%, as it estimated that tariffs would increase its costs by $900 million.
According to data from the US Bureau of Labor Statistics, the US added 177,000 jobs in April, down from March but significantly better than the market’s expectation of 135,000.
Analysts point out that this report helps alleviate market concerns about an economic slowdown. Meanwhile, traders still anticipate at least three interest rate cuts by the Federal Reserve this year, but the likelihood of a fourth cut has decreased from around 60% pre-data release to about 30%.
Goldman Sachs stated that due to the strong performance of the US economy, the timing of the next rate cut might be pushed back from June to July.
Despite an unexpected 0.3% contraction in US GDP in the first quarter, mainly driven by companies importing large quantities of goods to avoid impending counter tariffs, leading to an expansion of the trade deficit, the data is considered short-term distortion.
On Friday, the Chinese Ministry of Commerce stated that China is evaluating the possibility of negotiating with the US on economic and trade issues, a sudden change in stance that has raised expectations of a resumption of negotiations amidst economic pressures, leading to speculation that Beijing may no longer sustain a confrontational position against the US.
President Trump also announced preliminary trade agreements with India, South Korea, and Japan, with the first batch of tariff agreements for these three countries expected to be finalized within a few weeks.
Despite the positive employment and stock market data, some investors remain cautious, believing that the current rebound may only be temporary and that if trade policies take a more hawkish turn in the coming months, financial markets could experience renewed volatility.
Chris Zaccarelli, Chief Investment Officer of Northlight Asset Management, stated, “We have seen how the financial markets react if the government proceeds with the original tariff plan. Therefore, unless they adopt a different strategy at the end of this 90-day buffer period in July, the market may experience the kind of intense volatility seen in early April once again.”