Trump’s 90-day tariff pause: What it means for India, China, and Global Trade | SME Futures
Big news in the financial world—the United States and China have agreed to lower reciprocal tariffs for the next 90 days, and it’s already sending ripples across global markets. If you’ve been following the rollercoaster ride of international trade over the past year, this latest development might just be the breather investors needed.
But what does this really mean for the stock market, for investors like you, and for the broader economy?
Let’s break it down.
🚨 What Happened: A 90-Day Trade Truce
After months of tariff escalations—remember that staggering 145% tariff on Chinese goods?—the U.S. administration has finally hit the pause button.
The result? A temporary easing of tensions with major trade partners, not just China but also the EU and Great Britain.
This de-escalation is fueling optimism on Wall Street.
📈 Market Reaction: A Bullish Comeback?
Let’s talk numbers. The S&P 500 is up nearly 20% from its April low and is just 3% below its February peak. Meanwhile:
- Dow Jones is only 5% shy of an all-time high.
- Nasdaq is off by just 4.9%.
- Russell 2000—which tracks small-cap stocks—is still down 14%, but even that’s an improvement.
Economists and analysts are calling it a rebound of historic proportions—from bear market fears to nearly bull territory in weeks.
💬 Why Are Analysts So Bullish?
According to Wharton professor Jeremy Siegel, this could be what he calls the “Trump pivot.” With the tariff aggression on hold and signs of Middle East dealmaking, plus improving inflation data, Siegel believes stocks might just break records.
Another major voice, Tom Lee of Fundstrat Global Advisors, pointed to clear tariff policies, potential tax cuts, and regulatory easing as reasons for his bullish stance.
His bottom line? “2026 earnings have upside.”
🧠 Google’s EEAT Lens: What’s the Real Risk?
Let’s keep it real—this rally isn’t without risks. Just this Friday, Moody’s downgraded the U.S. credit rating, reminding everyone that high national debt still looms large. Even if the downgrade was expected, it highlights long-term fiscal concerns.
And as Lisa Shalett from Morgan Stanley warns, earnings momentum may start fading. She’s cautious about revenue slowdowns—even among tech giants like the “Magnificent 7.”
Her take? “It’s hard to justify the numbers.”
🤖 So, What Should Investors Do Now?
Here’s a simple breakdown of what this means for everyday investors:
- Short-Term: Expect continued volatility, but the current market momentum suggests potential upside—especially with tariff uncertainty easing.
- Medium-Term: Watch for Q2 and Q3 earnings data. If companies maintain performance despite past tariff pressure, the bull run could continue.
- Long-Term: Keep an eye on U.S. debt and interest rates. The Moody’s downgrade could affect bond yields, which in turn might pressure equities.
🔍 Final Thought: Is This Just a Pause or a Turning Point?
This 90-day tariff truce might feel like a breath of fresh air, but it’s not a full reset. The tariff baseline is still high, and officials have signaled that rates like 10% could become the norm.
So yes, the market rally is real—but fragile.
Still, with talks progressing, debt ceiling debates cooling, and investor sentiment turning cautiously optimistic, this could be the kind of moment that shapes the rest of the year.
Conclusively:
- U.S. and China agreed to lower tariffs for 90 days.
- The S&P 500 is up nearly 20% from its April low.
- Analysts like Jeremy Siegel and Tom Lee are optimistic.
- Risks remain: Moody’s U.S. credit downgrade, high debt, and slower future earnings.
- Investors should stay alert but cautiously optimistic.
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