Trump's Tariff Pause: Did They Work—and What Now?

The markets just had one of their best days in decades. That’s not hyperbole. The S&P 500 rocketed up 8%. The Dow soared over 2,600 points. The Nasdaq? A blistering 10.3% gain.

Why? In a surprise move, President Trump announced a 90-day pause on most tariffs, dialing them back to a flat 10% for most trading partners. But here’s the kicker: tariffs on China jumped to 125%, a targeted escalation aimed squarely at the world’s second-largest economy.

Markets cheered the clarity. But underneath the euphoria lies a more complicated question:Did Trump’s tariffs actually work? And what’s the bigger picture for investors?

Tariffs as a Negotiating Tool

From the beginning, Trump’s trade strategy has leaned on leverage. Tariffs were never just about revenue—they were about power, pressure, and forcing countries, especially China, to the table.

With China now “backed into a corner,” according to some analysts, the strategy appears to be working—at least on the surface. China responded with retaliatory tariffs of 84% on U.S. goods and filed a formal complaint with the WTO. In other words, they flinched, but they’re not out.

Europe, meanwhile, isn’t thrilled either. The EU has lined up $23 billion in countermeasures. Global tension? Still very much alive.

Markets Like Certainty, Even if It's Temporary

Despite the geopolitical fireworks, U.S. markets surged. Why? Investors got a reprieve from what felt like an escalating, chaotic trade war. A 90-day pause offers time—time for earnings to stabilize, for business plans to adjust, and for global supply chains to breathe.

It’s no coincidence that a solid U.S. bond auction also helped calm nerves. Investors saw a moment of coordination in what’s otherwise been a volatile environment.

Still, this isn’t a full unwind of the trade war. It’s a pause—and a strategic one.

Did the Tariffs “Work”?

Depends on what metric you use.

If the goal was to slow China’s dominance in global trade, it’s too soon to tell. China’s economy is feeling pressure, but it hasn’t buckled. Their markets even rose on the news, perhaps signaling resilience—or relief that the worst-case scenario was avoided (for now).

If the goal was to support U.S. industries, the results are mixed. Certain sectors, like steel and aluminum, saw temporary boosts. Others—like agriculture—were caught in the crossfire.

If the goal was to bring trading partners to the negotiating table? That part might be working.

The Bigger Picture for Your Investments

We’re not in the clear. This 90-day window might look like a breather, but it’s more of a chess move than a peace treaty. Markets are reacting to the pause—but investors should be thinking about the long game.

Tariffs, inflationary pressure, and shifting global alliances all have implications for your portfolio. More than ever, it’s crucial to stay diversified (and not just across sectors, but globally), stay informed, and stay nimble.

Because one tweet—or one policy shift—can still shake the landscape overnight.

Let’s Talk Strategy

If you’re wondering what this all means for your personal investment strategy, we’re here to help. The global chessboard is changing fast. But with the right plan, you don’t need to flinch at every move.

Reach out to your advisor at Halter Ferguson Financial. Let’s navigate this moment together—with purpose, perspective, and a long-term mindset.