After a turbulent trading session driven by recession fears, global markets showed signs of stabilization on Tuesday. The S&P 500 and Nasdaq saw steep declines following President Donald Trump’s tariff hike on Canadian steel and aluminum, but European and Asian markets have since regained footing.
Investors initially reacted with alarm as the U.S. stock market suffered its worst drop in months. However, optimism is returning as traders anticipate potential Federal Reserve intervention. The yield on the benchmark U.S. 10-year note fell 10 basis points, signaling expectations that the Fed may ease monetary policy to counter slowing economic growth.
“Markets are pricing in the possibility of rate cuts sooner than expected,” said a senior analyst at Bloomberg. “Investors are looking for signals from the Fed on how they plan to address economic headwinds.”
While the selloff has paused, uncertainty remains high. Many analysts warn that prolonged trade disputes and policy shifts could increase market volatility in the coming months.
According to CNBC, major firms are adjusting their strategies to hedge against potential disruptions caused by new tariffs and shifting global economic conditions.
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