U.S. equities got a badly needed jolt Tuesday, with all three U.S. benchmarks rising, led by a 1.1% gain for the Nasdaq. The S&P 500 rose for the second time in three days but is still down more than 4% since the president escalated the trade war on May 5. The spat has killed Asia’s rally and eliminated the year’s gains, though futures are trending up.

Live-Fire Experiment

Trump called on the Fed to “match” China’s moves to offset hardship from rising tariffs while reassuring nervous traders, saying the U.S. has “a dialogue ongoing” with Beijing and that the situation is “going to turn out extremely well.” As the China battle rages and a new one with Europe threatens, tariffs are starting to look like a goal rather than a tactic. Trump credits the levies for fueling domestic growth, and he’s engaged in a live-fire experiment with the world’s No. 1 economy in the petri dish.

‘A Hell of a Lot More’

Trump denied a NYT story that his administration is planning to send as many as 120,000 troops to the Middle East in the event of war with Iran. The president warned he’d send “a hell of a lot more” if hostilities broke out. Tehran has denied responsibility for a weekend attack on oil tankers in the Persian Gulf while the Houthi rebels it supports took credit for drone attacks that forced Saudi Arabia to shut its biggest oil pipeline, escalating regional tensions. Oil prices rose.

Yuan Reversal

Longtime China bear Kyle Bass closed his nearly four-year wager against the offshore yuan just as the trade war between the U.S. and China is intensifying. The Hayman Capital founder said his interests have shifted to the political sphere over national security concerns. He’d gone short on the renminbi in 2015 on expectations Beijing would exhaust its reserves defending the currency.

Alibaba and Tencent Report

Alibaba is expected to post a 48% jump in revenue when it reports fourth-quarter earnings Wednesday before the U.S. open. SunTrust sees trade tensions as a short-term uncertainty, though Goldman Sachs expects the company to “remain resilient.” Tencent also reports Wednesday, with its new game Perfect World in focus.