U.S. stocks experienced a major rebound on Tuesday as investors pushed past President Trump’s latest attack on Federal Reserve Chairman Jerome Powell.
The Dow rose more than 1,000 points, or 2.7%, to close at 39,187. The S&P 500 rose 130 points, or 2.5%, to close at 5,288, while the Nasdaq rose 2.7%.
The rebound suggests a more bullish attitude among investors who yesterday rushed to unload shares after Mr. Trump on Truth Social on Monday renewed his criticism of Federal Reserve Chair Jerome Powell for being “too late” to act, causing markets to major slump.
The potential Fed shakeup, coupled with uncertainty about trade policy, sent the Dow tumbling over over 1,000 points yesterday.
National Economic Council Director Kevin Hassett last week said Mr. Trump and his team are studying whether Mr. Trump can fire Powell. While the outlook for leadership at the Fed remains unclear, analysts say that removing Powell would destabilize the United States’ reputation on the world stage and set off a crisis in global financial markets.
As stocks edged up Tuesday morning, Adam Crisafulli, president of investment advisory firm Vital Knowledge, said a few factors could be at play. Among them: the potential for a US-India trade deal and certain key Congressional Republicans coming out in support of Fed independence.
Shares of Tesla stock, which released its earnings later today, rose 4.6%. Tesla shares are still down about 40% since the beginning of 2025.
Despite the positive day on Wall Street, Trump’s trade war continues to shake up markets around the world. The International Monetary Fund’s World Economic Outlook, released Tuesday, said the U.S. economy will grow 1.8% this year, down full percentage point from last year, citing the escalating trade war and “high levels of policy uncertainty.”
Global shares were trading mixed Tuesday, with the major Eurozone indices all edging down during early trading. Stock prices in Asia were mixed.
“Across Asia, there is undoubtedly a sense of urgency to get to the negotiation table even as striking a deal at an appropriate cost can be tough,” Tan Boon Heng, at Mizuho Bank’s Asia & Oceania Treasury Department, told the Associated Press.
The Dow Jones Industrial Average is on track for its worst April since 1932, The Wall Street Journal reported.
The dollar index steadied on Tuesday after sliding to its lowest level in three years on Monday, while the yield on the 10-year Treasury continued to climb, rising to 4.43% overnight before landing at 4.39% in the morning. Both the dollar index and yields on Treasury notes are key indicators of how much faith investors have in the economy.
contributed to this report.
