What Happened?
Shares of e-commerce software platform Shopify (NYSE: SHOP) jumped 5.9% in the afternoon session after stocks rebounded (Nasdaq +2.0%, S&P 500 +1.5%) following a report from The Wall Street Journal stating that the Trump administration's reciprocal tariffs, to be announced on April 2, 2025, would be more narrowly targeted. The market reaction indicated that investors took that as a sign the economic impact of the tariffs, particularly on inflation and growth, might not be as bad as they initially feared.
That's a bit of a relief, which likely gave businesses and analysts some space to rethink their outlooks. Earlier, the administration had hinted at much broader tariffs that could have hit any country placing duties on U.S. imports, so this shift was likely a welcome surprise for the market.
The shares closed the day at $109.32, up 4.9% from previous close.
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What The Market Is Telling Us
Shopify’s shares are very volatile and have had 20 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 7.2% on the news that the company announced plans to transfer its U.S. stock exchange listing from the New York Stock Exchange (NYSE) to the Nasdaq.
Markets likely reacted positively to the move, as companies listed on the Nasdaq exchange often benefit from a more technology-focused investor base, and increased visibility among growth-oriented funds. Given that technology is at the core of Shopify's business, this reinforced the favorable market sentiment.
Shopify is up 1.9% since the beginning of the year, but at $109.60 per share, it is still trading 15.2% below its 52-week high of $129.31 from February 2025. Investors who bought $1,000 worth of Shopify’s shares 5 years ago would now be looking at an investment worth $2,549.
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