Trump's Tariff Pause Saves Market From 'Edge Of The Cliff,' Dan Ives Says 'Biggest Wild Card' Still Remains

Wedbush's Dan Ives believes the 90-day tariff pause was exactly what the stock market was waiting for. Despite the strong rally in markets, the analyst cautioned that a “key obstacle” is still on the table.

What To Know: President Donald Trump on Wednesday announced a 90-day pause on tariffs in a post on Truth Social.

The announcement comes less than a day after Trump’s sweeping reciprocal tariffs went into effect. The tariff pause will be effective immediately for non-retaliating countries, while China will face a steeper 125% tariff due to the “lack of respect” the country has shown for global markets.

Trump said more than 75 countries reached out to U.S. officials to begin negotiations in response to the tariff announcement. The Trump administration will maintain a 10% baseline tariff across the board.

“This was the news we and everyone on the Street was waiting for as the pressure on Trump took on a life of its own and the eye popping rise of the 10-year yield was ultimately too much to hold his line on the self-inflicted Armageddon tariff unleashed at midnight,” Ives said in a new note to clients.

The Wedbush analyst expects “massive negotiations” to start to pick up over the coming months as attention turns toward a longer-term solution. Ives noted that China will be “front and center” for markets as the “biggest wild card.”

“For tech stocks, this was much needed relief and pulls stocks and the market from the edge of the cliff, although China remains the biggest X variable related to Apple and the broader supply chain,” Ives said.

Ives referred to the past several days as a “twilight zone week” for investors. Although real damage has already been inflicted on the economy, markets should see some relief as attention turns to negotiations and the ongoing trade war with China, which will be a “key obstacle” for U.S. tech stocks, the analyst said.

The SPDR S&P 500 SPY, which tracks the S&P 500, was up 8.74% at $539.86 at the time of publication Wednesday. The Invesco QQQ Trust QQQ, which tracks the Nasdaq-100, was up 11.2% at last check, according to Benzinga Pro.

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