US stocks rebounded Tuesday as traders attempted to claw back losses from a punishing start to the week.
The Dow Jones Industrial Average rose 400 points, or 1%, while the S&P 500 and Nasdaq Composite gained 1% and 1.1%, respectively.
The bounce followed a bruising Monday session, where the Dow shed over 970 points and both the S&P 500 and Nasdaq fell more than 2%, marking four straight days of losses for the Dow and Nasdaq.
Sentiment had soured after President Donald Trump’s fresh criticism of Federal Reserve Chair Jerome Powell, escalating investor anxiety over monetary policy direction.
Tesla climbed over 2% ahead of its first-quarter results after the close. Netflix added 3%, with Meta and Amazon each advancing around 1%.
Several major companies are scheduled to post their earnings this week.
Markets remain fragile, with geopolitical and policy risks continuing to weigh on investor confidence.
Uncertainty looms large
Investor anxiety has deepened after President Donald Trump renewed his public attacks on Federal Reserve Chair Jerome Powell on Monday, taking to Truth Social to warn that the economy would stall unless the Fed cuts interest rates.
In his latest post, Trump labeled Powell “Mr. Too Late” and a “major loser,” escalating a series of direct criticisms targeting the central bank chief.
Trump further hinted at Powell’s potential removal last week — an extraordinary threat given that Powell’s term runs through May 2026 and current law protects the Fed chair from arbitrary dismissal.
White House economic advisor Kevin Hassett confirmed the administration is reviewing its legal options on that front.
The remarks added to already fragile sentiment on Wall Street, where stocks have struggled since Trump’s announcement of sweeping “reciprocal” tariffs on April 2.
The three major indexes are each down around 9% since the tariff plan was unveiled, with Monday’s sharp sell-off reflecting a market increasingly rattled by political and economic uncertainty.
IMF cuts US growth outlook
Tariffs are emerging as a serious drag on both the US and global economies, prompting the International Monetary Fund to sharply downgrade its 2025 growth outlook.
President Donald Trump’s April 2 introduction of “reciprocal” tariffs rattled financial markets — the S&P 500 has fallen 9% since their announcement — while provoking swift retaliatory measures from major trading partners.
“This on its own is a major negative shock to growth,” the IMF warned in the executive summary of its April 2025 World Economic Outlook.
The report presents a “reference forecast” based on data through April 4, factoring in the initial tariff moves but excluding later developments such as the 90-day delay on higher rates and the smartphone exemption. It replaces the IMF’s January projections.
The revised forecast now pegs US economic growth at 1.8% in 2025, a sharp 0.9 percentage point cut from the earlier forecast.
Global growth was also marked down, with the IMF projecting a 2.8% expansion for 2025 — 0.5 percentage point lower than its previous estimate.
The post US stocks rebound on Tuesday: Dow up 400 points, Nasdaq surges 1% appeared first on Invezz