The biggest shock came Friday morning when President Trump made surprise comments about potentially placing steep tariffs on Apple products and imports from the European Union. These sudden threats, especially after previous talks of exemptions, raised questions about where U.S. trade policy might be headed and apparently caught markets off guard.

Also helping provide a boost, inflation data showed signs of cooling. Both consumer and wholesale prices came in lower than expected, which supports the case for the Federal Reserve to consider cutting interest rates in the near future.

The US and China struck a temporary deal halting reciprocal tariffs for 90 days and the futures markets are screaming higher as of this writing. This may well be the key driver of this week’s trade.

What’s more, the steep selloff following the April 2 tariff announcement has been fully reversed for the S&P 500 and Nasdaq, with both benchmarks now comfortably above those levels. While the Dow, small-cap Russell 2000, and mid-cap S&P 400 still have ground to recover, all are up double digits from their early April lows.

According to FactSet, 73% of companies beat expectations, making for a pretty good week across the board. The Nasdaq led the charge higher, and small- and mid-cap stocks logged their third straight week of gains. The major indexes have now put some real distance between themselves, and their recent correction lows the past couple of weeks. Since then, the Dow was up over 9%, the S&P 500 was up better than 14%, the Nasdaq has had an impressive 17+% return.