A false post on X (formerly Twitter) claiming that former President Donald Trump was planning to pause tariffs for 90 days on all countries except China caused a dramatic and short-lived surge in U.S. stock markets on April 7, 2025. The unverified information spread rapidly across financial media and social networks, triggering a chain reaction that added trillions to the market within minutes before a swift reversal wiped it out.
The misleading post referenced comments made by National Economic Council Director Kevin Hassett during a Fox News interview, but those remarks were taken out of context. Hassett never announced a policy change, and the White House was quick to issue a firm denial, calling the post fake news.
Despite the clarification, the markets had already responded. High-frequency trading algorithms, which monitor social media and news feeds to make split-second trading decisions, kicked into action and drove the S&P 500, Dow Jones, and Nasdaq sharply upward. At its peak, the market added nearly $2.4 trillion in value. However, as reality set in and the misinformation was debunked, the surge collapsed just as quickly, losing over $2.5 trillion in under 30 minutes. The market ended the day roughly flat.
This incident sheds light on the growing influence of social media and algorithmic trading in financial markets. It shows how a single unverified message, amplified by media and automated trading systems, can cause massive swings in market value. Analysts and financial experts warn that such episodes could become more frequent unless regulatory and technological safeguards are improved.
The event has reignited debates about the responsibility of media outlets in verifying sources, the risks posed by algorithm-driven trading, and the need for stronger monitoring of misinformation on digital platforms. Investors and policymakers are now calling for more robust systems to prevent the market from being manipulated or misled by unverified claims.
As the dust settles, this episode stands as a stark reminder of how vulnerable global markets remain in the age of instant information and digital speculation.