Wall Street got a jolt of optimism Tuesday after President Donald Trump made a surprising pivot on Federal Reserve Chair Jerome Powell. Just a day after lashing out at Powell in an interview, Trump clarified that he has no plans to fire him — he just wants interest rate cuts to come faster.
That quick change of tone landed well with investors. The Dow Jones Industrial Average shot up over 1,000 points, and the S&P 500 (SPX) and Nasdaq (NDAQ) both rose more than 2.5%, reversing Monday's declines.
But it wasn't just the Powell comments lifting sentiment. Trump also floated the possibility of easing tariffs on Chinese goods. While he said rates wouldn't go all the way down to zero, the suggestion of a major cut to the current 145% level was enough to fuel some hope for progress on trade.
The U.S. dollar responded, too, with the dollar index climbing to 99.64 from 97.923 — its lowest point since March 2022.
Between the Fed reassurance and trade talk, markets seemed to breathe a little easier — at least for the day.
