Trump pauses tariffs, S&P 500 rallies 9.5% in largest single-day gain since 2008

The S&P 500 rallied 9.52% on April 9 2025, the largest single-day gain since October 13 2008 (+11.58%), after President Trump announced a 90-day pause on reciprocal tariffs for all countries except China. The announcement came at 1:18 PM ET via social media post. China tariffs were simultaneously raised to 125%. The Nasdaq 100 gained 12.02%, its second largest single-day gain on record.

Market breadth was extreme: 99% of S&P 500 members gained, with the equal-weighted index gaining 9.1%. Volatility strategies reversed the forced selling of the prior three sessions, and short squeezes contributed to amplified gains in small caps (Russell 2000 +8.7%) and high-volatility names. The VIX fell 27.56% to 33.62, still elevated but reflecting the removal of acute tail risk.

The reversal was only partial. By April 9 close, the S&P 500 at 548.62 remained 2.2% below the pre-Liberation Day level of 561.89. But the session demonstrated the Trump administration's willingness to reverse course on tariff severity when markets signaled stress. The "Trump put" framework that characterized the first term appeared intact, though the 125% China tariff rate signaled that US-China trade was structurally repriced.