Happy Tuesday! Lots of ground to cover across the stock market, Trump’s latest tariff comments, Tesla’s sharp stock rally, manufacturing data, and more. Was this email forwarded to you? Join 190,000 self-directed investors gaining an edge every morning. Sign up here. 

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A risky addiction

Investors didn’t cheer the end of tariffs. They cheered the possibility that they might not be as bad as feared. 

Each of the three major US stock benchmarks surged Monday, not on account of any economic clarity, but because President Trump said he may not go all-in with levies after all.

It’s one more example that shows markets in 2025 are reacting more to tone than substance.

A relief rally these days doesn’t necessarily require good news — just some ambiguity dressed as moderation. 

“Well I may give a lot of countries breaks, but it’s reciprocal, but we might even be nicer than that,” Trump told reporters at the White House Monday.

“They’ve charged us so much that I’m embarrassed to charge them what they’ve charged us, but it will be substantial.” 

The president has dubbed April 2 “Liberation Day” for the US, given that it’s supposed to mark the start of a sweeping tariff plan in favor of the US. 

Investors, for their part, have feared a sledgehammer: Inflation, compressed earnings, and heightened uncertainty.

Monday’s rally suggests they’re now betting on a hammer made of rubber.

Indeed, strategists at UBS have maintained an optimistic view for stocks in the months ahead, with or without policy wildcards. 

“We continue to expect the S&P 500 to end the year higher, and recommend phasing in and tactically buying the dip in US equities, including quality AI names,” said Ulrike Hoffmann-Burchardi, chief investment officer of global equities at UBS Global Wealth.

The White House said the most stringent duties would hit the so-called “dirty 15,” the nations with the largest trade surpluses against the US.

Presumably, that list includes China, Canada, the European Union, Japan, and Mexico, among others, and accounts for nearly 90% of goods traded with the US, according to an estimate from the US Trade Representative. 

Then again, why fret over who’s on the list when we don’t even know if the list exists? 

Tariffs have proven to be the driving force for markets since Trump 2.0 kicked off, suggesting short-term price action is now tied more to the illusion of certainty than actual policy.

Politics aside, investors aren’t positioning for trade policy to work or fail — they’re betting on not being blindsided.

So while Trump’s latest comments neither confirm nor deny his next move, they do slightly reduce the sense of chaos hanging in the air. 

To be clear, nothing is resolved. The White House still has the power to slap broad and brutal tariffs on entire industries, escalate a trade war with China, or turn its focus back to fentanyl flows. 

Either way, Monday’s stock surge tells us that investors have become conditioned for shifts in semantics as much as concrete resolutions. 

The best advice for a stock market this sensitive?

Buckle up.

Market snapshot

Elsewhere:

🚗 Tesla rebounded big Monday. The stock jumped more than 11% to notch its best day since November, and it led a broad relief rally for consumer discretionary stocks. Retail traders have piled into Elon Musk’s automaker even as protestors have lambasted the brand and vandalized vehicles. (Barron’s)

🧬 23andMe filed for bankruptcy. The stock tanked more than 58% after the announcement and CEO Ann Wojcicki resigned, stating that she aims to secure the assets independently. Concerns swirl now regarding what will happen to the millions of DNA samples the company owns, and what a potential buyer could do with the data. (WSJ)

📊 US business activity picked up in March. That’s according to flash PMI survey data, out Monday, which revealed a notable upturn in the service sector offset a recent decline in manufacturing output. Still, business expectations for the year ahead dropped to the lowest since October 2022. (S&P Global)

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About me:

📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day, unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else. Feedback? Reply to this email, ping me on X @philrosenn, or write me directly at phil@openingbellmedia.com.