Stock futures rocketed higher Sunday night. That’s good news Wall Street wants to see, as traders try to gauge the impact of President Donald Trump’s latest tariff actions. The Dow Jones Industrial Average had a very rocky week, but recovered nicely on Friday. It jumped 4.95% in the last five trading days, logging its largest weekly gain since the week ended November 3, 2023. At the same time, the broad-based small-cap Russell 2000 index’s 1.82% weekly increase was its largest since January 17, 2025.
President Trump’s latest tariff actions are still affecting the market as investors weigh their impact, creating an acute complexity to market dynamics. Futures linked to the Dow Jones surged by 251 points, showing 0.6% upturn. The market is setting itself up for what could be an important week. In the coming days, these “money center” banks’ interconnected majors Goldman Sachs, Bank of America, and Citigroup are all scheduled to report earnings.
The S&P 500 has made it tough on the home team lately, falling 5.4%. Meanwhile, the Nasdaq Composite and Dow Jones Industrial Average have dropped about 5% and 4.8%, respectively. Among those stocks, Apple has been the most severely dented. It declined by close to $640 billion in market value in only three trading days following the tariff promises.
Even with these failures propping up the market, the market itself is bolstered by record bank earnings and a potential Federal Reserve bailout.
“The mid-week delay on some non-China tariffs, along with solid banks earnings and optimism about Fed intervention (should it be needed) at the end of the week helped fuel the gains in US equities, with some also attributing Wednesday’s bounce to short covering,” – Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets.
The CBOE Volatility Index soared above 50 on Thursday during all these gyrations, an indication of the fear that has crept into the markets. CNBC Magnificent 7 Index, which has dropped about 5% since the tariff changes were first announced.
Markets were left to interpret the meaning of or direction behind Trump’s remarks on exempting certain products from tariffs. They knew these exemptions might not last forever.
“subject to the existing 20% Fentanyl Tariffs, and they are just moving to a different Tariff ‘bucket,’” – Donald Trump.