In a year when artificial intelligence has dominated Wall Street’s imagination, Donald Trump just reminded investors that he’s still the biggest single market mover on the planet.
For months, markets have been obsessed with AI from Nvidia’s parabolic rise to the trillion-dollar valuations of tech giants riding the wave. But on Friday, Trump showed that no algorithm can compete with the sheer unpredictability of his words.
After threatening to impose 100% tariffs on Chinese imports, Trump sent markets spiraling. The S&P 500 plunged 2.7%, oil dropped nearly 4%, and the 10-year Treasury yield fell by about 10 basis points as investors fled to safety.
The shockwaves extended beyond equities. Crypto markets already hypersensitive to macro headlines experienced one of their worst liquidation events in history. According to CoinGlass, over $19 billion in leveraged crypto bets were wiped out, with Bitcoin tumbling 13% and Ethereum down 15%.
“Friday’s sell-off was the largest liquidation in crypto markets ever,” CoinGlass said in a post on X, adding that Binance’s reporting limitations likely mean the true number was even higher.
Trump calms markets again
Then, just as quickly as he rattled investors, Trump reversed the panic. On Sunday evening, he took to Truth Social to reassure markets with a characteristically upbeat message.
“Don’t worry about China, it will all be fine!” Trump wrote. “Highly respected President Xi just had a bad moment. He doesn’t want Depression for his country, and neither do I. The U.S.A. wants to help China, not hurt it!!! President DJT.”
Within hours, sentiment flipped. Stock futures turned positive overnight, and by Monday’s opening bell, markets were surging again. The S&P 500 jumped 1.55%, the Dow Jones Industrial Average rose 1.3% (up 590 points), and the Nasdaq Composite climbed 2%. Oil prices rebounded nearly 3%, while Bitcoin bounced above $115,000, recovering part of its losses.
Trump’s ability to cause and then undo trillion-dollar market swings in a weekend underscores his ongoing influence. Even as AI dominates economic discourse, Trump’s words remain one of the most potent market-moving forces in the world.
Markets are showing nerves beneath the AI hype
Friday’s volatility was more than just a reaction to Trump’s tariff threat; it also revealed how fragile the current rally is. With valuations at record highs, investors are growing anxious about potential downside catalysts and the former president’s unpredictable trade rhetoric offers the perfect spark.
“While stocks have largely moved on from the tariff tantrum of April, Friday’s market decline is an important reminder that trade tensions are still in the background and can cause bouts of short-term volatility,” said Richard Saperstein, CIO at Treasury Partners.
“When valuations rise, like they have in recent months, they become more prone to headline-driven declines.”
Others see the sell-off as a long-overdue correction following months of relentless gains.
“The setup for a correction within this new bull market was already in place,” wrote Mike Wilson, chief investment officer at Morgan Stanley. “Elevated positioning, valuation anxiety, and seasonals all we needed was a catalyst. Unexpected trade escalation provided that. If we don’t see near-term de-escalation, we think a larger correction is likely.”
Trump’s market power endures
Even after years out of office, Trump’s influence over global markets hasn’t faded. During his presidency, his tweets routinely triggered rapid movements in oil, currency, and equity markets. Now, in a time dominated by AI hype and algorithmic trading, his unpredictability still cuts through the noise.
In an age when automated systems execute billions of trades per second, Trump remains the ultimate human algorithm capable of moving markets with a few words.
As investors grapple with the twin forces shaping 2025 AI euphoria and geopolitical uncertainty they’ve learned one thing for sure: no matter how advanced the models get, Donald Trump still writes the market’s script.
