A day after posting its first 1 per cent loss in two months, the S&P 500 posted its first 1 per cent reversal of the year, with Thursday’s recovery from Jerome Powell’s press conference torpedoed by a Donald Trump tariff tweet.

To recap: stocks plunged Wednesday as Powell described the Federal Reserve’s rate cut as a “mid-cycle adjustment,” which traders interpreted as signaling fewer reductions. After bouncing back, equities tumbled anew when Trump said he would impose a 10 per cent tariff on US$300 billion in Chinese imports that aren’t yet subject to levies. Dutifully, traders of fed funds futures boosted the amount of easing they expect from the Fed this year after the tweet hit.

Some equity players doubt it’s coincidental. By their logic, after the Fed chairman said his rate cut was justified by trade tensions, it makes sense the president would be tempted to create more of them.

Ryan Larson, head of U.S. equity trading at RBC Global Asset Management

“The timing is certainly interesting and leads one to wonder whether the President would still be announcing the additional tariff now had yesterday’s FOMC press conference gone differently.”

Ed Moya, chief market strategist at Oanda Corp.

“It is providing a little bit of fuel to his fire in the timing of this escalation. I don’t think anyone is surprised that we’d see a new tariff threat but not even 24 hours after this rate decision, we saw this come out. He wants to see the Fed deliver an easing cycle not a mid-cycle adjustment. The Fed has been very clear that there are a few things would make them deliver rate cuts and a fallout of trade talks with China is going to be very damaging for economic growth and that would warrant the beginning of an easing cycle.”

Arthur Hogan, chief market strategist at National Securities Corp.

“That’s the real problem. In large part, nobody on the Fed believes tariffs are good economic policy. But they also know that becoming easier on monetary policy, they were going to embolden trade policy. They didn’t have to wait 24 hours to see the results.”

“Unfortunately, as we’ve seen with all these other tariffs, they start at 10 per cent and they don’t stop there. And it probably doesn’t help us negotiate. This is like going from a frying pan into the fire.”

Yousef Abbasi, director of U.S. institutional equities and global market strategist at INTL FCStone.

“Being the devil’s advocate: what difference does it make? Tariffs will hurt the global economy and the Fed, ECB, BoJ, BoE will all step in to keep money easy and stimulate. So while it certainly is annoying -- and this move could see China walk away or express displeasure with retaliatory tariffs -- but if/when that happens, the market seems to go to ‘old reliable,’ it’s the belief that central banks will step in and print to help keep us from recession.”