Markets rally after Trump eases concerns over tariffs and says he won’t try to fire Fed Chair Powell

NEW YORK AP U S stocks are leaping Wednesday as a worldwide rally comes back around to Wall Street following updates from President Donald Trump about his plans for the Federal Reserve and his business war that investors unveiled encouraging The S P was higher in early trading coming off a big gain Tuesday that wiped out a loss that was nearly as big on Monday The Dow Jones Industrial Average was up points or as of a m Eastern time and the Nasdaq composite was higher Wall Street s gains followed strong moves higher for stocks across much of Europe and Asia They also continue a dizzying up-and-down run for markets as investors struggle with how to react to so much uncertainty about what Trump will do with his economic policies Even after Wednesday morning s big gain the S P remains below its record set earlier this year after briefly dropping roughly below That s why one of the meager predictions several along Wall Street are willing to make is only that sharp swings will continue for a while The sector will more likely than not continue to be dictated by Trump s latest whims regarding tariffs and deal announced Tim Waterer chief sphere analyst at KCM Arrangement The territory s latest move is up in large part because Trump noted late Tuesday that he has no intention to fire the head of the Federal Reserve Trump had been angry with Jerome Powell whom Trump had called a major loser because of the Fed s hesitance to cut interest rates While cutting rates could give the market system a boost it could also put upward pressure on inflation Economists say Trump s tariffs are likely to slow the commercial sector and raise inflation at least briefly Trump s tough talk frightened Wall Street because the Fed is supposed to act independently without pressure from politicians so that it can make decisions that may be painful in the short term but are best for the long term The majority legal scholars agree that Trump can t fire Powell from the Fed s board of governors and there is no legal precedent for doing so However there is less agreement over whether a president can remove him as chair Trump may have recognized the domain s fear about a move against Powell He may also be looking to keep around someone that Trump could blame later if the market system does fall into a recession Indeed if the Fed cuts its strategy interest rates aggressively Trump would have little excuse for a recession apart from the pugnacity of his tariff policies declared Thierry Wizman a strategist at Macquarie Markets also rose after Trump disclosed late Tuesday that U S tariffs on imports coming from China will likely come down substantially from the current It won t be that high not going to be that high Trump revealed The hope along Wall Street has been that Trump may lower his tariffs after negotiating business deals with other countries If he brings tariffs down by enough and promptly investors believe a recession could be averted Trump s comments also had a big effect on the bond territory where Treasury yields eased sharply It s a turnaround from earlier this month when spiking Treasury yields were raising fears that Trump s actions were scaring away investors and weakening the U S bond arena s reputation as one of the safest places to park cash The yield on the -year Treasury fell to from late Tuesday On Wall Street Tesla helped lead the way by revving higher after CEO Elon Musk declared he ll spend less time in Washington and more time running his electric truck company Tesla on late Tuesday stated a big drop in profits and it has been struggling because of backlash against Musk s efforts to lead cost-cutting efforts by the U S administration In stock markets abroad indexes jumped in France in Hong Kong and in Japan Stocks in Shanghai were an exception where they dipped