Stocks Hit by Dizzying Swings as Bond Yields Surge: Markets Wrap
Apr 07, 2025 by Bloomberg(Bloomberg) -- Waves of volatility shook markets anew, with stocks, bonds and commodities getting whipsawed by another deluge of headlines around President Donald Trump’s trade war that only reinforced the clouds hanging over the outlook for investors.
Traders looking for equities to bottom after a selloff of trillions of dollars were faced with a series of twists and turns on Monday. While the S&P 500 moved away from the threshold of a bear market, its 7% intraday swing was the biggest since 2020 when Covid upended global trading. Treasuries weakened in a volatile session, with yields across all maturities higher by at least 10 basis points — a stark turnaround from the plunge earlier in the day.

Trump threatened additional 50% import taxes on China while readying negotiations with Japan and Israel. He posted various messages on talks with trading partners, and volatility spiked after a report about his willingness to consider a blanket tariff pause - which the White House denied. The European Union is proposing to impose 25% tariffs on some US goods.
As markets got rattled, Wall Street titans came up with some serious warnings. Bill Ackman said the US is “heading for a self-induced, economic nuclear winter.” Boaz Weinstein predicted the “avalanche has really just started.” And Jamie Dimon said it “may be disastrous in the long run.”
“For now, it looks like news out of Washington will continue to drive the market’s swings, one way or the other,” said according to Chris Larkin at E*Trade from Morgan Stanley.
To Matt Maley at Miller Tabak, those looking for a V-shaped recovery in the stock market will likely be very disappointed.
“We should see a strong bounce at some point soon, but the process of repricing the market to its realistic economic outlook will take time,” Maley said. “There will be plenty of time to get aggressive when it becomes more evident that the worst of the decline is behind us.”
HSBC strategist Max Kettner is making the case for a “very short-term bounce” in stock markets, with the Magnificent Seven possibly benefiting the most. However, any rebound will only set the stage for another leg lower, he warns. To Morgan Stanley’s Michael Wilson, investors should be prepared for the S&P 500 to drop further if tariff angst doesn’t subside.

“Many metrics are at panic levels associated with meaningful bottoms over the past 40 years,” said Jonathan Krinsky at BTIG. “The issue is when you get into the capitulation zone, markets often move beyond what many think is likely or possible.”
Hedge funds recorded their largest-ever one-day net sales of global equities on the first day of trading after Trump’s sweeping tariffs announcement, according to Goldman Sachs Group Inc.’s prime brokerage desk. The same division at JPMorgan Chase & Co., which also saw aggressive selling among hedge funds, said declines in positioning would indicate the market is getting close to a tactical bottom.
Meantime, the retail crowd is the last group of investors that has yet to sell US equities, presenting an additional risk to the stock market, according to Goldman’s trading desk.

The slump in equities has taken US equity valuations to the lowest level since late 2023.
At Bespoke Investment Group, the strategists say investors are indeed look for signs of a break in the selling vortex.
“You’ll hear all sorts of opinions as to when and where the market will bottom out, but they’re all guesses, so ignore them,” they noted. “No one knows at this point.”
Larry Tentarelli at the Blue Chip Daily Trend Report, investors should maintain defensive positioning, above average cash levels, and reduced if any new buying until volatility comes down.
“Market direction will be based on the tariff news cycle to start the week,” he said. “If there is a material, positive change in the news cycle, markets could benefit. Until then, continue to expect very wide trading ranges.”

“The swift and sudden stock market decline is a repricing to reflect an impending recession from the burden of tariffs,” said Richard Saperstein at Treasury Partners. “Markets won’t rebound until tariffs are negotiated and reduced, until valuations move even lower to very compelling levels, and until fundamentals improve, and none of these factors are in the cards at this time.”
Wall Street forecasters are racing to temper their views on US equities as Trump’s sweeping tariffs threaten to upend the global economy.
JPMorgan Chase & Co.’s Dubravko Lakos-Bujas slashed his year-end forecast for the S&P 500 to 5,200 from 6,500 previously. Oppenheimer & Co.’s John Stoltzfus — the biggest bull among strategists until March — cut his outlook to 5,950 points from 7,100. Strategists at Evercore ISI, Goldman Sachs Group Inc. and Societe Generale SA have also reduced targets in recent days.
In a note to clients Monday, Stoltzfus said uncertainty was “at levels investors find hard to embrace.” This is being combined with “a negative pitch book that seemingly projects negative outcomes to infinity.”
“Our base case is that after an initial phase in which tariffs could rise further, US effective tariff rates should start to come down from 3Q,” said Solita Marcelli at UBS Global Wealth Management. We also expect the Fed to cut interest rates by 75-100 basis points to support the economy. In this scenario, we believe the S&P 500 can recover to 5,800 by year-end.
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Some of the main moves in markets:
Stocks
- The S&P 500 rose 0.2% as of 2:47 p.m. New York time
- The Nasdaq 100 rose 0.8%
- The Dow Jones Industrial Average fell 0.6%
- The MSCI World Index fell 1.4%
Currencies
- The Bloomberg Dollar Spot Index rose 0.5%
- The euro fell 0.2% to $1.0930
- The British pound fell 1% to $1.2758
- The Japanese yen fell 0.6% to 147.88 per dollar
Cryptocurrencies
- Bitcoin was little changed at $78,802.01
- Ether fell 0.9% to $1,560.12
Bonds
- The yield on 10-year Treasuries advanced 15 basis points to 4.15%
- Germany’s 10-year yield advanced three basis points to 2.61%
- Britain’s 10-year yield advanced 17 basis points to 4.61%
Commodities
- West Texas Intermediate crude fell 1.7% to $60.93 a barrel
- Spot gold fell 2.2% to $2,970.89 an ounce
This story was produced with the assistance of Bloomberg Automation.
©2025 Bloomberg L.P.
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