Senator Elizabeth Warren, the Massachusetts Democrat, has asked the Securities and Exchange Commission to investigate whether President Trump violated securities laws while reversing course on his global tariffs.
Early Wednesday, during a period of intensely volatile trading, Mr. Trump wrote on social media, “THIS IS A GREAT TIME TO BUY!!!” Hours later, he announced a 90-day pause on many tariffs, sending the S&P 500 soaring more than 7 percent in just minutes. Wednesday was the best day for the S&P 500 since the recovery from the 2008 financial crisis.
“In recent days, President Trump has announced a series of erratic, reckless tariffs, leading to significant market turmoil,” Senator Warren wrote in a letter to Paul Atkins, the chair of the S.E.C. “As a direct result of this chaos, the U.S. financial markets have experienced dramatic declines over the course of just a few days.”
She added, “It is unclear which officials and affiliates of President Trump had advance knowledge of his plans to delay tariffs — but insiders may have known that he was going to announce a tariff pause and that the market would improve.”
A White House spokesman did not respond to a request for comment on the letter.
Mr. Trump made the decision to halt the tariffs following a rapid rise in bond yields and increasing concern about the economic consequences of the quick and drastic reset in global trade policy.
It is far from certain that Senator Warren’s letter will spur any investigation at the S.E.C. Senator Warren has been an adamant opponent of Mr. Atkins, whom she has accused of having conflicts of interest from his work with banks and financial firms. Mr. Atkins, who founded Patomak Global Partners, a financial services consulting firm, was confirmed by the Senate this week.
But the letter, whose list of signatories include Senator Chuck Schumer of New York, the minority leader, underscores growing scrutiny of Mr. Trump’s comments ahead of the official announcement to pause tariffs. On Thursday, Representative Maxine Waters of California sent a letter to the S.E.C. and the U.S. Government Accountability Office similarly requesting an investigation.
Of particular concern to Ms. Waters was a spike in trading of call options — or bets that a stock will rise — in the period directly leading up to Mr. Trump’s announcement.
“The timing and scale of the call option purchases would suggest that an official of the Administration, or perhaps the President himself, provided friends or associates with a heads up that the announcement was happening,” Ms. Waters wrote.
Financial experts said that they had seen no immediate proof of insider trading and that many of the spikes in purchasing on Wednesday had occurred at the same time as the announcement. “Speed is not illegal,” said Steve Sosnick, the chief strategist at Interactive Brokers.
Still, Mr. Sosnick said, given market volatility and heavy trading volume surrounding the announcement, it would be very difficult to ascertain any illegal activity from looking at market moves alone.
“Just because I can’t find a smoking gun doesn’t mean there wasn’t one,” he said.
In her letter to Mr. Atkins, Senator Warren asked what steps the S.E.C. would take to investigate potential market manipulation or insider trading. She also asked whether cost-cutting efforts would affect the agency’s ability to carry out any investigation.
Zolan Kanno-Youngs contributed reporting.
