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Stocks Whipsawed After White House Called Trump Tariff-Pause Rumor “Fake News”

Stocks briefly surged on an unverified tariff-pause rumor in April 2025, then reversed after the White House called it fake news. The later April 9 delay was a separate decision.
From TheFinanceBase Team4 min to read
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Stocks briefly rebounded on April 7, 2025, after an unverified claim spread that President Donald Trump would pause tariffs for 90 days on countries other than China. The White House rejected the claim as “fake news,” and the rebound reversed. The rumor did not explain the broader tariff selloff: markets were already under pressure after Trump announced broad tariffs on April 2.

What happened on April 7, 2025?

The sharp swings followed a fast-moving sequence, not a confirmed policy announcement. Earlier that morning, White House National Economic Council Director Kevin Hassett was asked on Fox News about a 90-day pause proposed by a hedge fund manager. His answer was noncommittal: “I think the president is going to decide what the president is going to decide,” the Associated Press reported.

Markets began climbing around 10:09 a.m. Eastern, while the first identified X post claiming a pause appeared at 10:11 a.m., according to PolitiFact. The exact origin of the purported headline was unclear. CNBC reported White House Press Secretary Karoline Leavitt’s “fake news” characterization at 10:33 a.m.; the White House Rapid Response account also rejected the claim shortly afterward. PolitiFact reported the White House response as: “Wrong. Fake News.”

The Associated Press described a dramatic Dow Jones Industrial Average intraday reversal: it briefly erased a morning loss of 1,700 points, climbed more than 800 points, then fell back to a loss of 629 points. The S&P 500 also made sudden up-and-down moves. Those numbers describe the reported intraday episode, not a closing performance summary for every index.

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Why did stocks jump on an unverified rumor?

Investors were reacting to the possibility that tariffs might be delayed, not to a verified change in policy. The broad tariff announcement on April 2 had unsettled markets; a report suggesting a pause could reduce the immediate risks investors associated with tariffs. As traders responded to the claim, prices moved quickly. When the White House rejected it, the reason for that brief optimism weakened and the market move reversed.

The timing does not establish that the rumor caused the whole selloff. The tariff announcement and uncertainty were the larger context; the rumor and denial corresponded to a short-lived intraday whipsaw within that context.

What was verified—and what was not?

PolitiFact found no credible report that the administration had publicly considered the specific 90-day pause before the White House rejected the speculation. It concluded that social-media posts exaggerated Hassett’s noncommittal answer, and rated the claim that he said Trump was considering the pause false.

The rumor’s starting point remains unclear. PolitiFact reported that markets began climbing just before the first identified X posts and that an account amplifying the claim said trading desks had circulated a headline; it could not establish where that headline originated. The Associated Press likewise described the origin as unclear and said the rumor appeared to stem from a misinterpretation of Hassett’s interview. The available reporting does not establish who created the claim.

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Why the April 9 tariff delay does not make the April 7 rumor true

On April 9, two days after the rumor, Trump announced a 90-day delay for some tariffs on all countries except China, reversing his prior stance, according to PolitiFact’s editor’s note. That later decision is separate from the claim the White House denied on April 7. A subsequent policy change does not verify an earlier rumor retroactively.

How the April 7 episode differs from the broader tariff shock

The Federal Reserve Bank of San Francisco’s later analysis examined market reactions to the April 2 tariff announcement, not the specific April 7 rumor. In its sample of 23 developed markets in the MSCI World index, every market declined from April 2 to April 4, 2025, with cumulative declines ranging from 1% to 11%. The analysis also found that dividend futures signaled lower expectations for future profits and credit-default-swap evidence was consistent with increased downside risk.

Event window What it covers Evidence and scope
April 2–4, 2025 Market response to Trump’s broad tariff announcement Federal Reserve Bank of San Francisco analysis of stocks, credit-default swaps, dividend futures and foreign exchange; all 23 developed markets in its MSCI World sample declined 1% to 11% cumulatively.
April 7, 2025 Brief rebound and reversal amid an unverified tariff-pause rumor and White House denial Associated Press contemporaneous account of intraday index moves; PolitiFact’s fact-check of the rumor and its origin.

These are different episodes and types of evidence. The Fed analysis supports conclusions about the wider reaction to the tariff announcement; it does not measure the effect of the April 7 rumor.

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What the episode means for interpreting market news

A dramatic intraday swing is not, by itself, evidence that a policy change has been confirmed or that a market has entered a sustained rally. The April 7 move illustrates why a fast-moving claim should be checked against an attributable, authoritative statement before being treated as policy. Jane Kirtley, a University of Minnesota professor of media ethics and law, told PolitiFact: “The White House may not have been immediately forthcoming, but ultimately, news organizations should do everything possible to confirm a rumor — especially one with the implications this one had.”

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This is a historical account, not a statement of current tariff policy. The U.S. Trade Representative’s index lists later tariff actions and trade agreements extending into 2026; anyone checking a present-day measure should consult the relevant current action or agreement at USTR’s trade topics index.

Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.

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