Investors who took President Trump at his word and acted on his explicit stock market cues this year have been rewarded with sizable gains—particularly when his comments preceded key trade policy announcements.
Trump’s direct interventions into the market narrative—especially when timed around trade-related developments—have twice fueled significant equity rallies in recent months. On both occasions, his comments signaled upcoming de-escalation in trade tensions and were followed by substantial market moves, notably in the S&P 500.
The first instance occurred on the morning of April 9. At 9:37 a.m. ET, Trump posted on Truth Social: “THIS IS A GREAT TIME TO BUY!!!” Later that same day, the administration announced a temporary 90-day suspension of reciprocal tariffs affecting most U.S. trading partners. The news triggered a dramatic surge in equity markets, with the S&P 500 gaining 9.5% in the final hours of trading—its strongest one-day advance since the global financial crisis in 2008.
Roughly one month later, on May 8, Trump again offered a pointed market cue, telling reporters at the White House: “You better go out and buy stock now.” Four days later, in the early morning hours of May 12, Treasury Secretary Scott Bessent announced a 90-day de-escalation in the trade war with China. U.S. tariffs on Chinese imports were reduced to 10%, down from prior elevated levels. The announcement sent equities sharply higher at the open, with the S&P 500 jumping 2.6% and fully recouping its losses since April 2—known among some market watchers as “Liberation Day.”
Measured over the 21 trading sessions between Trump’s April 9 and May 8 remarks, the S&P 500 climbed 14%. According to Bloomberg data, that stretch represented the most powerful rally over a similar time period during either of Trump’s presidential terms, excluding the extreme volatility witnessed during the pandemic. The magnitude of the move highlights the influence that policy signals—especially those originating from the highest levels—can have on market sentiment and positioning.
While Trump is known for regularly commenting on markets—often applauding rallies or crediting himself for gains—these two episodes stand out due to their timing and direct nature. Unlike broader commentary or post-facto declarations, both April and May messages preceded clear, market-moving policy shifts and were interpreted as signals of de-risking within U.S. trade strategy.
For wealth advisors and portfolio managers, the episodes underscore the potential impact of political signaling on short-term market behavior. While long-term allocations should remain grounded in fundamentals, opportunistic traders and tactical allocators may find value in closely monitoring political rhetoric—especially when it aligns with potential macro policy pivots.
Still, despite the recent gains, the broader macroeconomic backdrop remains complex. The U.S. economy continues to show signs of late-cycle dynamics. Many economists have increased the probability of a recession unfolding later this year, pointing to a combination of restrictive monetary policy, persistent inflationary pressures, and uneven global demand.
Trump’s 10% baseline tariffs remain in place across most imports and are expected to feed through to consumer prices and corporate margins over the coming quarters. Even as front-page trade tensions temporarily ease, the structural implications of protectionist policy continue to challenge global supply chains and investment flows.
Advisors should also be mindful of the risk that recent market strength is largely sentiment-driven and tied to tactical headlines rather than durable earnings growth. While political figures can catalyze rallies with policy hints or pronouncements, sustainability hinges on underlying economic momentum and central bank posture.
In the case of the early 2025 rallies, markets responded swiftly to expectations of lower trade friction, but the longer-term efficacy of such policy pauses remains uncertain. A 90-day reprieve may alleviate immediate pressure on multinational earnings and input costs, but it does little to resolve structural tensions between the U.S. and China or re-anchor longer-term trade norms.
Furthermore, the path of inflation remains a central concern. Despite a recent cooling in headline CPI, core inflation—particularly in services—remains sticky. With the Federal Reserve signaling a cautious stance on rate cuts, financial conditions are likely to remain tight, limiting the upside for rate-sensitive assets.
The strategic takeaway for RIAs and wealth managers: while political cues can drive meaningful near-term market dislocations, they should be contextualized within a broader risk management framework. Tactical responses may benefit from flexibility and agility, but core asset allocations should remain aligned with long-term objectives, client timelines, and macro fundamentals.
Trump’s recent forays into market guidance—though striking in their efficacy—do not represent a repeatable alpha strategy on their own. They highlight the importance of scenario planning, real-time monitoring of policy dynamics, and the need for RIAs to guide clients through both the signal and noise of a politically charged investing environment.
Even as equities push higher on the back of trade de-escalation narratives, advisors must prepare clients for potential reversals. As history shows, market sentiment can shift abruptly, especially when policy shifts are temporary or dependent on political maneuvering rather than economic reform.
Ultimately, Trump’s commentary and its market impact serve as a reminder of the outsized role that leadership communication can play in shaping investor psychology. In a year likely to be defined by both geopolitical shifts and domestic electioneering, advisors should remain vigilant in separating transient headlines from structural opportunities and risks.
