Wall Street Today: S&P 500 Jumps 3%, Dow Jones Up 1,000 Points After US-China Trade Truce
The S&P 500 soared 3% at open to go over 5,800, while the Dow Jones added over 1,000 points or 2.4% to 42,345. The tech-heavy Nasdaq surged 4% to 18,674.
Wall Street cheered the US-China trade truce on Monday as the two largest economies agreed to suspend tariffs on some of each other's goods for 90 days following talks in Geneva.
The S&P 500 soared 3% at open to go over 5,800, while the Dow Jones added over 1,000 points or 2.4% to 42,345. The tech-heavy Nasdaq surged 4% to 18,674.
The tariff suspension applies to certain levies imposed in April and will take effect by May 14.
The agreement lowered the total tariff rate on targeted goods from 145% to 30%. Both countries will retain a 10% ad valorem rate while suspending 24 percentage points of their additional tariffs. China will take steps to withdraw tariffs and suspend or eliminate non-tariff countermeasures imposed since April 2.
US Treasury Secretary Scott Bessent said the recent trade escalation with China is unfortunate, and both sides agree that a generalized decoupling is undesirable. However, the US is now seeking strategic decoupling with China.
Bessent expressed skepticism about China tariffs dropping below 10% and mentioned that the US can revisit the April 2 level for China tariffs. Additionally, it was noted that Trump viewed an 80% tariff rate as not equivalent to an embargo on China.
All but one of the 11 sectoral indices on the S&P 500 advanced, led by consumer discretionary and energy stocks. Consumer staples counter was down.
Shares of chipmakers ON Semiconductor, Super Micro Computer, Texas Instruments and Micron Technologies gained. Tesla, Facebook-parent Meta Platforms and Apple jumped 5%.
The yield on the benchmark 10-year US Treasury bonds rose 9 bps to 4.47%.
The US dollar surged 1.6% to 101.94, gaining over the pound, euro and yen.
