The "Trump put" wasn't dead, it was just resting
Add Axios as your preferred source to
see more of our stories on Google.
Photo: Tasos Katopodis/Getty Images
If markets learned one thing from the last week's White House tariff drama, it was that President Trump is still paying attention.
Why it matters: The "Trump put" that investors relied on in his first term — the notion that Trump would change policy if stocks or bonds had a bad reaction — looked like it might be dead in the second term. Until Wednesday.
What they're saying: In an impromptu news conference outside the White House, Trump was asked why he told the markets to "be cool" in a Truth Social post early Wednesday, only to then pause most tariffs hours later.
- "Well I thought that people were jumping a little bit out of line. They were getting yippy, you know, they were getting a little bit yippy, a little bit afraid," Trump said.
Reality check: They were.
- The S&P 500 had fallen 11% from the April 2 reciprocal tariff announcement until early Wednesday afternoon, moments before Trump announced the pause.
- Perhaps more concerning, though was the plunging bond market, with 10-year U.S. Treasury yields rising 50 basis points in two days.
- "The bond market is very tricky. I was watching it. But if you look at it now, it's beautiful. The bond market right now is beautiful. I saw last night where people were getting a little queasy," Trump said.
Flashback: The "Trump put" was well known to markets the first time around, as in 2019 when stocks swooned amid ongoing trade talks between the U.S. and China.
- But a well-timed tweet indicating optimism was all it took to spark a rally.
Zoom in: Stocks jumped on today's news, but bonds didn't move nearly as much.
- As of mid-afternoon, the 10-year yield was well off its highs of the day, but still only as low as it had been around sunrise.
The bottom line: "Today's announcement seems to confirm that there is, in fact, a 'Trump put' but that markets had underpriced the strike price," Stifel chief Washington policy strategist Brian Gardner wrote Wednesday.
