US stock markets surged on Wednesday after The Wall Street Journal reported that the White House is considering slashing its steep tariffs on Chinese imports in a bid to de-escalate trade tensions with Beijing.
The tariffs, which are currently as high as 145%, could be reduced in the range of 50% to 65%, the publication stated.
Shortly after the news emerged, the S&P 500 jumped 3.4% to 5,465, with all eleven sectors in green. Industrials, consumer discretionary and information technology stocks surged.
The Dow Jones Industrial Average added nearly 1,200 points or 3% to go above 40,300. The tech-heavy Nasdaq gained 4.3% to come close to 17,000.
The prospects of a US-China tariff truce will calm investors reeling since the 'Liberation Day' Trump tariffs. A twin whammy of inflation and recession in the world's largest economy has hit sentiment.
Among the key gainers in early trade was Tesla Inc., whose stock jumped 7%. This came after the EV maker's chief Elon Musk indicated that he would pull back "significantly" from his work in the Department of Government Efficiency to concentrate on Tesla.
Chipmakers Super Micro Computer Inc. and Intel Corp gained 12% and 7% respectively, while Amazon.com zoomed 8%.
Trump said Tuesday he's willing to take a less confrontational approach to trade talks with China, noting that the current 145% tariff on Chinese imports is "very high, and it won't be that high".
"No, it won't be anywhere near that high. It'll come down substantially. But it won't be zero," he said, according to CNBC International.
Besides, US Treasury Secretary Scott Bessent at a forum said Washington and Beijing have an "opportunity for a big deal" on trade.
Easing worries over tariffs helped US Treasuries, with the benchmark 10-year yields falling 15 basis points to 4.23%.
As risk assets recovered, safe haven gold fell 3.6% to $3,260 per ounce.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
