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US stocks surged to close near the highs of the session on Monday after a US-China deal to temporarily slash reciprocal tariffs offered relief to markets worried about a trade war.
The S&P 500 (^GSPC) soared nearly 3.3% to its highest level since March 3. The Dow Jones Industrial Average (^DJI) gained 2.8%, or more than 1,100 points. The tech-heavy Nasdaq Composite (^IXIC) led gains, rocketing up 4.3%.
Wall Street notched a banner day after the US and China put tariffs on pause for 90 days, as the scope of the tariff reductions surprised investors. The US is dropping its duties on most Chinese imports from 145% to 30%, while China is lowering its 125% tariff on US goods to 10%.
Read more: The latest on Trump's tariffs
Investors jumped into shares of Big Tech megacaps bruised by trade war worries. AI chip leader Nvidia (NVDA) popped more than 5%, with Amazon (AMZN), Apple (AAPL), and Tesla (TSLA) also surged.
President Trump on Monday signed an executive order aimed at lowering prices on drugs sold in the US, after promising on social media to bring in cuts of at least 59%. The plans could end up raising prices overseas, boosting revenue for pharma companies, a White House official said, per Axios.
Meanwhile, the dollar (DX=F) and US Treasury yields (^TNX) climbed, as oil (CL=F, BZ=F) powered higher to lead a rally in commodities.
Traders will get their first sense of the initial inflationary effects of Trump's tariffs with the release of key inflation data this week. April’s Consumer Price Index (CPI) report is due Tuesday, followed by retail sales and the Producer Price Index (PPI) on Thursday.
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Dow, S&P 500, Nasdaq surge as trade war fears ease after China-US tariff truce
Stocks surged on Monday as investors viewed a US-China trade breakthrough over the weekend as a clear sign that the trade war has significantly eased.
The S&P 500 (^GSPC) soared 3.3%, while the Dow Jones Industrial Average (^DJI) gained 2.%, or more than 1,100 points.
The tech-heavy Nasdaq Composite (^IXIC) led the gains, rocketing up 4.3%.
All of the 'Magnificent 7' stocks jumped, led by shares of EV manufacturer Tesla (TSLA), e-commerce giant Amazon (AMZN), iPhone maker Apple (AAPL), and chip giant Nvidia (NVDA).
Investors will get key economic data reads this week, including April’s Consumer Price Index (CPI) report due Tuesday, followed by retail sales and the Producer Price Index (PPI) on Thursday.
Bitcoin drops 2%, hovers below $102K
Bitcoin (BTC-USD) fell more than 2% on Monday to hover below $102,000 per token.
The world's largest cryptocurrency had touched a session high north of $105,000 before declining.
Bitcoin is up more than 8% year-to-date.
Mentions of 'tariffs' in earnings calls soared since Trump's election
Mentions of "tariffs" have soared during earnings calls this year, according to new S&P Global Market Intelligence data.
Since President Trump was elected, the number of times tariffs were used in an earnings call increased across all eight sectors tracked by the analysis.
The consumer sector saw the biggest rise in mentions of tariffs, with the topic appearing in 64 calls in the six months after the November elections, compared to 10 calls in the prior six months.
Meanwhile, mentions of tariffs in the industrials sector climbed to 61 from 10 during the post-election period.
Other keywords and phrases covered by the analysis included inflation, interest rates, and artificial intelligence.
Some companies have pulled their outlook during this past earnings season, citing uncertainty stemming from tariffs.
US-China tariff pause may save the year for retailers
Yahoo Finance's Brooke DiPalma writes:
Read more here.
Tesla, GM, Ford stocks charge higher on hope autos are 'next on the docket' for trade talks
President Trump excluded auto imports from the tariff pause his administration reached with China on Monday. But that didn't stop auto stocks from surging on hopes automakers could be next in line for a reprieve.
Tesla (TSLA) stock rose 6.8%, adding to its double-digit gains for the month. Shares of General Motors (GM) jumped 4%, while Stellantis (STLA) increased 6% and Ford (F) was up 2%, rounding out the gains for the Big Three automakers.
Meanwhile, Chinese EV makers XPeng (XPEV) and BYD (BYDDY) each surged over 7%.
Yahoo Finance's Pras Subramanian reports on Wall Street's reaction:
Wall Street's worst fears over Trump's trade war just faded
Yahoo Finance's Josh Schafer reports:
Read more here.
Oil jumps as traders signal 'risk back on' after China-US trade truce
Oil jumped as much as 4% before paring gains Monday after a US-China trade truce sent the overall stock market and commodities higher.
West Texas Intermediate (CL=F) futures rallied over 2% to hover near $62.50 per barrel. Brent crude (BZ=F), the international benchmark, also rebounded to trade above $65.
Monday's oil price rally was exacerbated by a likely short position covering after talks between the US and China resulted in a 90-day pause on tariffs and a substantial reduction of duties.
"For traders it's a 'risk back on' signal which is triggering some short covering in crude," Dennis Kissler, senior vice president at BOK Financial, wrote in a client note. Investors had feared the trade war would spark an economic slowdown, impacting oil demand.
Fed's Kugler warns Trump tariffs will push up prices and and push down incomes
Yahoo Finance's Jennifer Schonberger reports:
Read more here.
US-China trade deal optimism offers important investing reminder
On a new episode of the Opening Bid podcast, one financial manager advised being selective as trade talks continue. Yahoo Finance's Brian Sozzi reports:
Trump: US will 'no longer tolerate profiteering and price-gauging from Big Pharma'
President Trump promised to cut the cost of pharmaceutical drugs in the US on Monday via an executive order.
"Starting today, the United States will no longer subsidize the healthcare of other foreign countries ... and will no longer tolerate profiteering and price-gauging from Big Pharma," Trump said.
"We're getting them down 67%, 80%, 90%," Trump said on price reductions.
The president said the US has the highest prices in the world, as the nation is where pharmaceutical companies make most of their profits, while the same drugs cost much less in other parts of the world.
Trump hints China's 'opening up' will take time to make official
President Trump said China has agreed to "opening up" to US businesses, though a formal agreement has yet to be reached.
"The biggest thing that we're discussing is the opening up of China, and they've agreed to do that, but it's going to take a while to paper it. That's not the easiest thing to paper," Trump said at the White House.
He added that China will also suspend all of its non-monetary trade barriers. Trump made the comments during a press briefing on Monday about the signing of an executive order to slash drug prices.
Trump said he plans to speak with China's President Xi Jinping, "maybe at the end of the week".
Gold tumbles nearly 3% as investors go risk-on
Gold futures (GC=F) tumbled 3% as investors jumped into equities, selling off the safe-haven asset after the US and China's temporary trade truce.
As of 9:45 a.m. ET, gold futures hovered near $3,244 per ounce.
The precious metal is up roughly 24% year to date after a massive run-up in recent months as investors flocked to the safe-haven asset amid the global trade war.
Productive trade talks between the US and China at the weekend have eased concerns of an economic slowdown caused by tariffs.
Dow gains 1,000 points, while Nasdaq, S&P 500 also surge after tariff deal
Stocks soared on Monday after a trade deal between the US and China resulted in a 90-day pause on tariffs. Duties on imports from both countries are set to drop by 115 percentage points by Wednesday.
Tech stocks led the gains, with the Nasdaq Composite (IXIC) surging over 3%, while the S&P 500 (GSPC) soared 3%. The Dow Jones Industrial Average (^DJI) jumped more than 2.4%, or over 1,000 points.
The "Magnificent 7" megacap tech stocks rallied, with shares of e-commerce giant Amazon (AMZN) rising 7.6%. Tesla (TSLA) also gained 7.8%Apple (AAPL), Meta (META), and Alphabet (GOOG, GOOGL) all advanced.
US-China temporary trade truce 'very bullish' for Big Tech: Wedbush's Ives
Odds of a 'V-shaped recovery' rising, strategist says
A pause on the large portion of tariffs between China and the US has Wall Street strategists turning more bullish again.
In a note to clients on Monday morning, Fundstrat head of research Tom Lee said the recent updates on negotiations with China "add to a series of incremental macro positives over the past few weeks, which have supported the improving positive risk/reward in stocks."
"We believe the probabilities favor a V-shaped recovery," Lee said, noting that the recent surge in bearish sentiment among investors has more room to flip positive.
Tech stocks stage major rally premarket on China tariff pause
US tech stocks rallied across the board on the news of a US-China trade deescalation, lifting futures on the Nasdaq Composite (NQ=F).
Amazon (AMZN), the No. 1 trending ticker on Yahoo Finance Monday morning, spiked 7.6%. The tariff pause is likely a welcome sign for the e-commerce giant, whose sellers often source goods from China.
In other tech names, Apple (AAPL) surged 6.2%, Meta (META) added 5.5%, and Alphabet (GOOG, GOOGL) advanced 2.4%.
Tesla (TSLA) also soared 7.8%, adding to a wave of good fortune, which Yahoo Finance's Hamza Shaban wrote about here. Tesla stock is up nearly 15% in the past three weeks
Chipmakers also rallied, with Nvidia (NVDA) and AMD (AMD) up 4.5% and 5.5%, respectively.
Stock futures surge as US-China agree to cut tariffs
Stock futures are surging after the US and China agreed to slash tariffs and deescalate the two countries' trade war.
S&P 500 futures (ES=F) climbed 3%, while Dow Jones Industrial Average futures (YM=F) gained 2.4%, or around 1,000 points. Contracts on the tech-heavy Nasdaq 100 (NQ=F) led gains, soaring 3.8%.
Meanwhile, the US dollar (DX-Y.NYB) gained 1.4%. Bitcoin (BTC-USD) declined slightly, down 0.25%. and Gold (GC=F) tumbled 3.6% to trade around $3,220 per ounce.
Pharma stocks tumble as Trump vows to cut US drug prices
Bloomberg reports:
Analysts react to US-China tariff pact
Investors worldwide are assessing the US-China deal to reduce their hefty rates of reciprocal tariffs, slashed by 115 percentage points to 10% on both sides.
Aaron Hill, FP Markets' chief analyst
This "marks a pivotal moment in global trade dynamics. However, the 90-day timeframe indicates these tariff cuts are a negotiation tactic rather than a permanent resolution, creating uncertainty about long-term trade policies."
Kenneth Broux, Societe Generale senior FX and rates strategist
"There is a de-escalation between China and U.S. resulting in a reduction of tariff on Chinese goods to 30% and Chinese tariffs on US goods to 10%. It's a clear vote by the market in favour of riskier assets. It's a step in the right direction and a positive of U.S. assets and U.S. economy."
Jane Foley, Rabobank head of FX strategy
"That doesn’t mean that we’re back to where we were before the Trump inauguration, the 10% baseline tariff still exists everywhere, the 90 pause is there and the clock is starting to tick. The overall scenario is not as bad as it could have been, but we still have a fair amount of uncertainty about where these tariffs will settle, their impact on world growth and central bank policy."
Oil leads commodity rally as gold retreats
Crude oil, copper (HG=F) and crop futures rose, but gold prices sank after the US and China said they had agreed to a mutual reduction in tariffs.
Brent crude rose 2.4% to trade above $65 a barrel, while WTI crude jumped 2.6% to almost $63 a barrel.
Bloomberg reported:
Oil holds as traders seek clarity on US-China trade deal
Oil prices fluttered on Monday after optimism as traders looked for concrete outcomes from recent US-China trade negotiations, which both sides described as showing “substantial progress.”
Bloomberg reports:
