Investors will be closely watching the jobs report on Friday for any signs that President Trump’s early policy priorities, including tariffs and layoffs of federal workers, have started to dent the U.S. economy.
Wall Street remains on edge about — and heavily influenced by — Mr. Trump’s trade wars and their potential to prompt an economic slowdown, putting fresh economic data and corporate earnings reports in the spotlight. The jobs report for April, which has the potential to fuel or ease angst on Wall Street depending on the strength of the employment figures, comes as stocks have stabilized in recent days. Investors have latched onto proclamations from administration officials about positive trade negotiations taking place behind the scenes, even as many of those claims have been rebuffed.
The S&P 500 was 1.4 percent higher for the week through Thursday, further buoyed by strong earnings reports from technology giants. Meta said on Wednesday that it anticipated continued growth despite Mr. Trump’s tariffs.
The Trump administration’s assertions since April 9 about progress in trade talks, which investors have welcomed as a sign that the White House might be paying more attention to the stock market, followed a dramatic two-day sell-off spurred by Mr. Trump’s unveiling of his suite of tariffs on April 2. The S&P 500 tumbled more than 10 percent in two days, a drop comparable to some of the worst days of the pandemic-induced sell-off in March 2020 and the financial crisis in 2008.
When markets closed on April 8 — the day before the tariffs were set to take effect — the S&P 500 had fallen 18.9 percent below its previous peak, in February. With the market continuing to fall, Mr. Trump announced on April 9 that he would pause, for 90 days, the most punitive tariffs on all countries except China. Stocks rallied, with the S&P 500 recording its best day since 2008.
Mr. Trump’s ramped-up attacks on the people and institutions underpinning U.S. exceptionalism, such as Jerome H. Powell, the chair of the Federal Reserve, have also prompted drastic daily swings in recent weeks. His threats aimed at Mr. Powell unnerved investors who see the central bank’s independence as critical to the health of the U.S. economy. And Mr. Trump’s subsequent remarks — that he had “no intention” of firing the Fed chair — fueled a rally, underscoring the extent to which investors are swayed by off-the-cuff comments from him and other officials.
That persistent unease and uncertainty sits in the backdrop of the relative calm in the stock market ahead of the fresh employment data. Mr. Trump’s 90-day pause of many of his tariffs, which put the market’s meltdown on hold, will end in July, risking more bouts of volatility.
On Wednesday, Mr. Trump blamed his predecessor for the market turmoil.
“This is Biden’s Stock Market, not Trump’s,” Mr. Trump wrote on Truth Social. “I didn’t take over until January 20th. Tariffs will soon start kicking in, and companies are starting to move into the USA in record numbers.”