US stock markets make a comeback after 4-day losing streak as S&P 500 surges by 2%

U.S. Stock Markets Rebound Strongly After Tariff Delay, S&P 500 Jumps 2%

U.S. stock markets staged a powerful recovery on May 27, 2025, ending a four-day losing streak as President Donald Trump delayed a steep 50% tariff on European imports. The S&P 500 surged 2.05% to close at 5,921.54, while the Dow Jones Industrial Average rose 740.58 points, or 1.78%, to 42,343.65. The Nasdaq Composite outperformed with a 2.47% gain, closing at 19,199.16, driven by strong performances from tech giants like Tesla and Nvidia.

Relief Rally Fueled by Trade Optimism

The rally was sparked by Trump’s decision on May 25 to postpone the tariff, originally set for June 1, until July 9 following an appeal from European Commission President Ursula von der Leyen. This eased immediate trade tensions, boosting investor confidence. Posts on X reflected this sentiment, noting the market’s relief-driven bounce, with the Nasdaq leading due to gains in Tesla (up 7%) and other tech names like Nvidia, AMD, Apple, and Microsoft. Consumer confidence also beat expectations, rising to 98 against a forecast of 86, further fueling the risk-on mood.

Broad Market Gains and Corporate Developments

The upswing wasn’t limited to large caps—over 90% of S&P 500 stocks closed higher, and the small-cap Russell 2000 gained 2.5%. Beyond tech, U.S. Steel rose 2% amid reports of Nippon Steel finalizing its $55-per-share acquisition. Kevin Hassett, Director of the National Economic Council, predicted more deals soon, adding to the bullish sentiment on CNBC’s “Squawk Box.” However, some analysts remain cautious, with Trivariate Research’s Adam Parker warning that fundamentals could weaken, particularly if U.S.-China trade tensions escalate.

Crypto Market Joins the Surge

The crypto market also celebrated, adding $1 trillion in value since April 8, a 42% rise, with the total market cap now at $3.4 trillion—6% shy of its December 2024 peak. Bitcoin traded at $109,877, reflecting the broader risk-on sentiment. Despite the rally, concerns linger about the stock market’s vulnerability to trade policy shifts, with China remaining a critical wildcard. For now, Wall Street’s relief has set a positive tone, but the sustainability of this rebound remains under scrutiny.