Anthony Matesic, a specialist, is seen working at his station on the floor of the New York Stock Exchange on Friday, April 11, 2025. (AP Photo/Richard Drew)
Wall Street wrapped up a roller-coaster week on Friday with a powerful rally in stocks, even as worries about the U.S.–China trade dispute and market instability continued to swirl.
The S&P 500 surged by 1.8%, rebounding from a shaky start, while the Dow Jones Industrial Average swung dramatically from a loss of nearly 340 points to finish with a 619-point gain, or 1.6%. The Nasdaq also bounced back, rising 2.1% by the end of the day.
The sudden lift in U.S. stocks came as some pressure eased in the bond market, which has been flashing warning signs all week. Bond yields, which often move slowly, have jumped sharply, causing concern among investors. The yield on the 10-year U.S. Treasury note, which started the week at 4.01%, peaked at 4.58% before slipping to 4.48% by the close of Friday.
Such moves matter because they can raise borrowing costs for businesses and homeowners and often signal deeper economic fears. However, the late dip in yields offered a small measure of relief.
Boston Federal Reserve Bank President Susan Collins tried to calm nerves, telling the Financial Times that the Fed is ready to step in if financial markets become too disorderly.
Part of the recent surge in bond yields may stem from global investors pulling out of U.S. assets due to the ongoing trade war. Some hedge funds could also be selling U.S. bonds to raise cash for other losses. On a more troubling note, concerns are growing over whether the U.S. is still viewed as the safest place to store money, especially after unpredictable tariff actions by President Trump.
On Friday, China announced steep new tariffs on U.S. goods, hiking them to 125%, escalating the standoff further. In a strong statement, China’s Finance Ministry accused the U.S. of turning the tariff war into a meaningless numbers game and warned of firm retaliation if provoked again.
This trade battle, especially between the world’s two largest economies, could eventually hurt global growth. Even though Trump recently paused some tariffs for countries other than China, uncertainty is still clouding the economic outlook.
Evidence of that unease is showing up in American households. A University of Michigan survey revealed a sharp drop in consumer confidence, cutting across all age groups, regions, and political views. Many Americans now expect inflation to climb to 6.7% over the next year — the highest expected rate since 1981.
Wall Street's sharp moves were also shaped by better-than-expected earnings from major U.S. banks. JPMorgan Chase, Morgan Stanley, and Wells Fargo all beat profit forecasts, though only JPMorgan saw a significant stock jump, gaining 4%.
Meanwhile, a report on wholesale inflation in March came in cooler than expected, which could give the Federal Reserve some room to adjust interest rates if needed. Still, investors are cautious, fearing inflation may pick up in the coming months due to new tariffs.
Overseas, markets were mixed. Germany’s DAX slipped 0.9%, while London’s FTSE 100 rose 0.6% after a surprise economic bump. Japan’s Nikkei fell 3%, but Hong Kong’s Hang Seng climbed 1.1%.
