Wall Street Surges 7% After Trump Pauses Global Tariffs/ Newslooks/ WASHINGTON/ J. Mansour/ Morning Edition/ Wall Street rallied sharply Wednesday after President Trump paused some global tariffs, calming investor fears of a recession. The S&P 500 jumped nearly 8%, with the Dow and Nasdaq also posting major gains. However, Trump raised tariffs on China to 125%, keeping U.S.-China tensions high.
Trump Tariff Pause Sparks Market Rally Quick Looks
- S&P 500 jumps 7.8% after Trump pauses tariffs
- Dow surges over 2,400 points, Nasdaq up 9%
- 90-day tariff suspension excludes China, which faces 125% rate
- Global markets remain volatile amid ongoing trade war fears
- China vows retaliation, increasing tariffs to 84%
- U.S. Treasury yields spike, then settle slightly lower
- Analysts see pressure on consumer loans and mortgage rates
- Foreign markets fall, but Chinese indexes buck the trend
Wall Street Surges 7% After Trump Pauses Global Tariffs
Deep Look
Markets Surge as Trump Pauses Global Tariffs, Raises Pressure on China
NEW YORK — April 9, 2025 — In a stunning turnaround, U.S. markets roared higher Wednesday after President Donald Trump announced a 90-day pause on new tariffs for most countries, delivering the relief investors had been anxiously awaiting. The S&P 500 soared 7.8%, its best single-day performance in years, as Wall Street embraced the temporary reprieve from escalating trade tensions.
The Dow Jones Industrial Average surged 2,476 points, or 6.6%, while the Nasdaq composite rocketed 9%, led by tech and consumer stocks that had been battered by tariff fears.
The rally followed a surprise social media post from President Trump, who declared:
“I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately. Thank you for your attention to this matter!”
Global Pause—Except for China
While the move offered a significant reprieve for many U.S. trading partners, China was the notable exception. Trump simultaneously announced an increase in tariffs on Chinese imports to 125%, intensifying the ongoing economic standoff between the world’s two largest economies.
Trump framed the hike as a response to China’s continued resistance to U.S. trade demands.
“Based on the lack of respect that China has shown to the World’s Markets… the days of ripping off the U.S.A. are over,” Trump said in a follow-up post.
China responded swiftly, declaring it would raise tariffs on U.S. goods to 84% starting Thursday. A spokesperson for the Chinese Ministry of Commerce warned of further retaliation, saying Beijing was prepared to “fight to the end” if the U.S. continued to escalate economic hostilities.
Volatility Still a Theme
Despite Wednesday’s market euphoria, volatility remains a defining feature of 2025’s financial landscape. On Tuesday, the S&P 500 swung between a 4% gain and a 3% loss in a single session — the second straight day of extreme reversals as investors struggle to navigate Trump’s unpredictable trade policy.
Wednesday’s rally came after the markets had dipped in the morning, rattled by uncertainty over whether the president’s tariffs would stick and what consequences they might have on the economy.
Many analysts had warned that the tariff hikes could tip the U.S. into a recession, especially as prices for imported goods rise and global trade flows contract. Trump’s announcement offered a temporary sigh of relief — but not a long-term solution.
Treasury Market Still Sending Warning Signals
The bond market, often viewed as a more sober barometer of economic risk, remains unsettled. The yield on the 10-year U.S. Treasury note briefly surged to 4.50% early Wednesday, before pulling back to 4.36%. Rising yields are often seen as a sign that investors expect higher inflation or need to sell bonds to cover losses elsewhere.
Typically, in times of market uncertainty or geopolitical tension, investors flock to U.S. Treasurys as a safe haven. This week’s selloff, which drove yields up instead, suggests heightened anxiety — and possibly a sign that international investors are souring on U.S. debt amid the trade war.
Higher Treasury yields also pose a challenge for consumers, as they influence mortgage rates, auto loans, and credit card interest, adding to financial pressures for households.
Global Reactions Mixed
While Wall Street rebounded sharply, foreign markets mostly declined amid ongoing concerns over trade instability.
- London’s FTSE 100 fell 2.9%
- Tokyo’s Nikkei 225 slid 3.9%
- France’s CAC 40 dropped 3.3%
Surprisingly, Chinese markets saw gains despite the escalating tensions with Washington. The Shanghai Composite rose 1.3%, and Hong Kong’s Hang Seng Index gained 0.7%, possibly buoyed by expectations that Beijing would implement domestic stimulus measures to offset tariff impacts.
Short-Term Relief, Long-Term Uncertainty
While investors welcomed the 90-day pause on tariffs, the lack of clarity about which countries are included — and what comes next — continues to cloud the outlook.
“The president gave markets a gift today, but the underlying issues are still unresolved,” said Marla Denton, a senior analyst at Broadstone Markets. “The tariff war with China is now more intense than ever. This is not the end — it’s just a break.”
For now, Wall Street is celebrating. But as trade policy continues to evolve day by day, investors, businesses, and global leaders are left to wonder whether the relief rally is temporary — or the start of a more stable chapter in U.S. economic diplomacy.
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