A trader works on the floor of the New York Stock Exchange on April 8, 2025.
Michael Nagle | Bloomberg | Getty Images
The S&P 500 fell into negative territory Tuesday afternoon, losing all earlier gains, as President Donald Trump’s tariff deadline neared.
The broad market index last traded around 0.4% lower, while the Nasdaq Composite dropped 0.6%. The Dow Jones Industrial Average added 102 points, or 0.3%. The major averages lost gains from an earlier relief rally, during which the 30-stock Dow had jumped as much as 3.8%, and the S&P 500 and Nasdaq had rallied more than 4% each.
Hopes were higher Tuesday morning that the U.S. to reach a negotiations that would lower tariffs on major trading partners, which powered the earlier relief rally.
Trump posted on Truth Social Tuesday that he had a “great call” with the acting president of South Korea, and that China “also wants to make a deal badly.”
Treasury Secretary Scott Bessent also told CNBC on Tuesday that around 70 countries had approached the U.S. for tariff negotiations. “If they come to the table with solid proposals, I think we can end up with some good deals,” Bessent said. “And part of the calculus of that may be that some part of the tariffs stay on.”
Despite talk of deals, however, none appear close to being hatched before Trump’s deadline for just after midnight when the higher reciprocal tariff rates kick in on top of the 10% baseline duty already implemented on Saturday.
Tuesday’s rally wipeout marks the fourth day of violent market volatility, along with steep losses. Monday marked the highest trading volume for U.S. markets in at least 18 years, at roughly 29 billion shares. The 30-stock Dow Jones Industrial Average plunged more than 1,700 points at one point in the session. Between the day’s highs and lows, the index swung 2,595 points. The blue-chip index ultimately closed down by 349 points, or 0.9%.
The S&P 500 briefly entered bear market territory at the lows of Monday’s session, down more than 20% from its record, before rebounding slightly and finishing the session slightly lower. The benchmark lost 10% in two days to end last week, its worst losses since 2020 during the outbreak of Covid, on fears that Trump’s shockingly high tariff rates on most of the world will lead to a recession.
Despite Tuesday’s gains on growing optimism for tariff negotiations, investors will need to see more stability in trade policy for the bounce to have legs, according to Robert Ruggirello, chief investment officer at Brave Eagle Wealth Management.
“There has to be some staying power, something [where] corporations can make longer-term capital allocation decisions. They have to have confidence in a consistent policy,” said Ruggirello.
Apple shares fell 3% after having risen more than 4% earlier Tuesday. The iPhone maker, which is heavily exposed to China, has has lost around 19% in the last three trading sessions.
The CBOE Volatility Index – known as Wall Street’s so-called fear gauge – spiked to about 60 on Monday, an extreme level that could signal a technical bounce was due. On Tuesday, it flickered around 50.