US markets show modest gains as S&P 500, Nasdaq lead rally amid trade war tensions

US stock markets showed a mixed but slightly positive performance on Wednesday, with the Nasdaq Composite leading the charge. Investors appeared to focus on broader market trends, buoyed by solid earnings reports and continued growth in tech stocks.
As of 9:50 AM GMT-4 on April 9, 2025, the Dow Jones Industrial Average had climbed by 21.35 points, or 0.057%. The S&P 500 also posted gains adding 19.39 points (0.39%) to reach 5,002.16. The Nasdaq Composite surged by 190.59 points, or 1.25%, reaching 15,458.50, as technology stocks led the broader rally.
Meanwhile, Global markets experienced significant declines on Wednesday as tensions between the US and China escalated. China retaliated to US tariffs by imposing new levies of 84% on US goods, leading US equity futures to drop by 1.7%. European stocks followed suit, plummeting more than 4%, according to Bloomberg.
The market selloff intensified as the yield on 30-year US Treasuries surged above 5% for the first time since November 2023. This signalled growing concerns about the status of US bonds as a safe haven. The bond market turmoil spread globally, with UK borrowing costs reaching their highest level since 1998 and Japanese 40-year bond yields hitting a record peak. The US dollar weakened for a second consecutive day, Bloomberg reported.
“We’re well into an escalation phase in the trade war, and investors have nothing to hold onto at the moment,” said Alexandre Baradez, chief market analyst at IG Markets. “What’s clear now is that the US bond market is no longer a safe haven and is piling pressure on stock markets,” he added, as noted by Bloomberg.
Shares of major pharmaceutical companies such as Pfizer, Eli Lilly, and Bristol-Myers Squibb fell by approximately 3% after President Trump indicated that the US would soon announce “a major tariff on pharmaceuticals,” according to Bloomberg.
The worsening trade conflict, with tariffs on China rising to 104%, triggered alarm bells among investors, including Bill Ackman. Economists at JPMorgan and Goldman Sachs raised the probability of a US recession, a scenario that could complicate the Federal Reserve’s ability to respond to potential inflation driven by the new tariffs.
Ray Dalio, founder of Bridgewater Associates, warned of a “once-in-a-lifetime” breakdown in global monetary, political, and geopolitical systems. Alexandre Hezez, CIO at Group Richelieu, also expressed concerns that high volatility could trigger market accidents.
In the bond markets, the 10-year US Treasury yield rose by five basis points to 4.35%, while the dollar index fell. Investors sought refuge in safer assets, including the Japanese yen and Swiss franc, as the euro climbed above $1.10, according to Bloomberg.
US Treasury Secretary Scott Bessent stated on Wednesday that after decades of growth on Wall Street, it is now time for smaller institutions to thrive, as President Donald Trump’s new tariffs added to market instability.
“Wall Street has become wealthier than ever, and it will continue to prosper,” Bessent said during his speech at the American Bankers Association’s Washington Summit.
“But for the next four years, the Trump agenda will focus on Main Street—smaller businesses, investors, and institutions,” he added.
US equity futures saw a sharp decline, with the S&P 500 futures dropping 1%, Nasdaq 100 futures slipping 0.8%, and Dow futures falling 1.3%. The Stoxx Europe 600 index also faced heavy losses, plummeting 3.8%. This downturn reflected the growing unease in the markets amid the escalating US-China trade war, according to Bloomberg.
In currency markets, the Bloomberg Dollar Spot Index fell by 0.5%, signaling weakening confidence in the US dollar. Meanwhile, the euro rose 0.7% to $1.1039, the British pound gained 0.4% to $1.2815, and the Japanese yen surged 1% to 144.82 per dollar, as investors flocked to safer currencies amid rising global uncertainties.
Cryptocurrency markets also saw declines, with Bitcoin falling 0.7% to $76,482.09, and Ether dropping 1.3% to $1,460.84, as the broader market downturn intensified.
Commodities were not immune to the turmoil, with West Texas Intermediate (WTI) crude oil plunging 5.7% to $56.21 per barrel. In contrast, gold prices rose by 2.5%, climbing to $3,057.26 per ounce, as investors sought refuge in precious metals amidst growing volatility, as reported by Bloomberg.