In the overnight session, U.S. indices looked poised for further pain, but staged a notable comeback. China announced retaliatory tariffs against the United States, and the initial reaction saw many industrial heavyweights opening down significantly, with the announced tariffs affecting soybeans, beef, tobacco, and most notably aircraft among other products. Clarity and context were important as new chief economic adviser Kudlow assuaged market fears with talks of “carrots and sticks” and that Trump is “ultimately a free trader” in a television interview midday. It was a key test of support for U.S. equities, with the Dow Jones Industrial Average (+0.96%) closing more than 700 points off its lows to record a 230 point gain on the day. The S&P 500 (+1.16%) and Nasdaq Composite (+1.45%) saw even stronger daily gains to pare back recent losses. Consumer products companies led gains as traders picked tariff winners and losers.