U.S. stocks soared on Wednesday after President Donald Trump announced a 90-day pause on tariffs for most countries, while also escalating tariffs on China.
The S&P 500 surged by more than 9.5%, marking its best performance since 2008. The Nasdaq Composite jumped 12%, its second-largest gain ever and the biggest since 2001. Meanwhile, the Dow Jones Industrial Average soared over 7.8%, or roughly 3,000 points.
“I have authorized a 90-day pause, with a substantially lowered reciprocal tariff of 10% during this period, effective immediately,” Trump wrote on Truth Social just before the market surged. He also stated that tariffs on China would rise to 125%.
In a later remark, Trump referenced the strong market response, calling it a factor in his decision. “I thought people were jumping a bit out of line,” he said. He also celebrated the rally, calling it the “biggest day in financial history.”
The rally was led by major technology stocks. Nvidia surged by over 18%, Tesla gained almost 23%, and both Apple and Meta saw increases of around 15%. Amazon rose by 12%.
Meanwhile, the 10-year Treasury yield continued to climb, nearing 4.4% after pulling back slightly.
On the other hand, China retaliated with an 84% tariff increase, set to take effect on Thursday, escalating tensions between the two largest global economies. This move added to concerns about the broader economic impact.
Trump’s reversal of his tariff stance came after a turbulent week of trade negotiations. Last week, Trump’s announcement of “reciprocal” tariffs shocked the markets, triggering significant hikes on countries including Vietnam, Japan, and India. These increases went into effect on Wednesday, and while the Nasdaq entered a bear market, the S&P 500 and Dow saw sharp gains on Wednesday.
Trump also commented on the market’s fluctuations, encouraging on social media that it was a “great time to buy!!!”
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