Market Chaos Erupts Over False Trump Tariffs Pause

By: Eliza Bennet

The U.S. stock market experienced tumultuous swings earlier this week following the circulation of a false report suggesting the Trump administration was considering a 90-day pause on tariffs. The resulting market volatility saw the SPDR S&P 500 ETF Trust (SPY) initially surge to over $520, only to plunge below $495 within the trading session. Bitcoin also saw significant activity, climbing from $77,500 to $80,800 before retracting back to around $78,000 as the rumor was debunked.

This incident began with unverified social media posts, gaining traction when CNBC included the information in its headline feed without confirmation. The narrative was further spread by Reuters, complicating the situation as markets reacted to the perceived policy shift. The U.S. White House quickly moved to label these headlines as ‘fake news,’ affirming to CNBC that there was no truth to the suggestions of a tariff pause.

These rapid market movements aptly demonstrate the current hypersensitivity of global markets to any policy-related speculation. Analysts have described the incident as a potential flash event, attributing the fierce reactions to both algorithmic trading activities and speculative investor positioning. Nasdaq futures were not spared from this upheaval, experiencing a substantial percentage swing as well.

As such significant fluctuations occurred within less than an hour of market opening, analysts caution that this episode could be a precursor to further volatility throughout the week. With the S&P 500 reflecting a dramatic $2 trillion change in value, investors remain on edge about how such unwarranted speculation can impact market stability in the days to follow.