Trump’s Surprise Tariff Pause Triggers 9x Options Surge in Minutes

In Brief:

S&P 500 jumped 9.5% after Trump announced a tariff suspension.

SPY call options surged from $4.20 to $42 within hours, turning $2.1M into $21.4M.

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Markets exploded into green territory on Wednesday after former President Donald Trump announced a 90-day suspension of tariffs for select trading partners. The surprise move triggered a historic 9.5% rally in the S&P 500, catching many investors—and algorithms—off guard.

But some traders appeared to be ahead of the curve.

Roughly 18 minutes before Trump’s post went live at 1:18 PM ET, a sharp spike in SPY call options activity was recorded. SPY, the ETF tracking the S&P 500, saw more than 5,100 call contracts with a $502 strike traded at an average price of $4.20.

By late afternoon, as the market soared on the back of the tariff news, those same contracts ballooned in value to approximately $42 each—marking a 900% gain within hours. In raw numbers, that’s a jump from $2.14 million to $21.44 million in paper value, assuming a full position.

While the timing raised eyebrows, analysts say it may have been a calculated macro play. "Options volumes have been rising in anticipation of policy volatility," one trader told ChainCatcher. "This just happened to pay off massively."

SPY closed the day above $546, marking one of its strongest single-day performances in years. The rally also helped lift sentiment in crypto and global equities, though questions remain around the sustainability of the rebound and whether the policy change will stick.

Still, for some sharp (or lucky) options traders, Wednesday will be remembered as one of the cleanest plays of the year.

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