‘Escalate to de-escalate’ The lack of an enthusiastic relief rally in stock markets given Donald Trump’s turnaround on tariffs shows investors are feeling bruised by the events of the past 48 hours.

While trade belligerence does indeed look like a negotiating strategy, markets didn’t anticipate these shock-and-awe tactics so soon. It’s also a reminder that, especially just a week after the DeepSeek drama, investors are edgy about the potential for a correction. US equity valuations remain high and the S&P 500 is only 2% below its record close on Jan. 23.