(Bloomberg) -- Risk appetites vanished on Wall Street after the biggest burst of buying in years, with stocks falling even after subdued inflation data extended a bounce in Treasuries. The S&P 500 pared back about a quarter of Wednesday’s surge as investors braced for a potentially protracted period of global trade hostility.

The burst of euphoria flipped back to unease on concern tariffs will bring lasting damage to the economy despite President Donald Trump’s surprise reprieve. While the consumer price index cooled broadly in March, the data was calculated prior to widespread levies that risk contributing to price pressures. The US equity benchmark dropped over 2%. Treasuries paused a slide that had spurred fears about the health of the financial system.

“Healthy drop in inflation or big drop in demand?” said Bret Kenwell at eToro. “At the end of the day, we do need to see lower inflation to justify lower rates from the Fed and ease the burden on consumers. However, getting lower inflation due to a material drop in economic activity — and thereby jeopardizing the economy — isn’t the best route to take.”

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Even as financial markets cheered Trump’s decision to delay some of his tariff plans, the first signs of a slowdown in global trade are already emerging as companies around the world hit their own pause button on orders and he continues to escalate his trade war with China.

Federal Reserve policymakers have signaled they’re ready to hold their policy rate steady to minimize the risk that Trump’s tariffs trigger a persistent rise in inflation, even if the labor market softens further.

Some of the main moves in markets:

Stocks

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Cryptocurrencies

Bonds

Commodities

--With assistance from Sujata Rao, Margaryta Kirakosian and Anand Krishnamurthy.

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