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US Stocks Surge After Trump Pauses Most Tariffs, But China Levy Remains

Published on April 10, 2025 by Blog

US Stocks Surge After Trump Pauses Most Tariffs, But China Levy Remains

US stock markets experienced a significant surge on Thursday following an announcement by President Donald Trump that he would temporarily pause his “reciprocal tariffs” on nearly 60 countries for a period of 90 days. This move provided a wave of relief to investors who had been increasingly concerned about the potential for a global economic downturn sparked by escalating trade tensions.   

The S&P 500 and the tech-heavy Nasdaq Composite both recorded impressive gains, soaring by 9.52% and 12.16% respectively. The Dow Jones Industrial Average also saw a substantial increase, climbing by 7.9%. This dramatic turnaround came after days of market volatility and downward pressure fueled by fears of a widespread trade war.

However, President Trump’s tariff pause did not extend to China. Instead, he announced an increase in the tariff rate on Chinese imports to a staggering 125%. This decision indicates a continued hardening of the US stance towards China and suggests that the trade dispute between the two economic giants remains a significant point of concern.   

Treasury Secretary Scott Bessent clarified that while the “reciprocal tariffs” on most of the US’s major trading partners would be paused, a baseline tariff of 10% on nearly all global imports would remain in place. This suggests a recalibration of the US trade strategy, focusing the most intense pressure on China while offering a temporary reprieve to other nations engaged in trade negotiations.   

The market’s positive reaction to the tariff pause for most countries indicates the deep-seated anxiety among investors regarding a broader trade war. The surge in stock prices reflects a hope that this temporary measure could lead to more stable trade relationships, at least with key allies. However, the continued escalation of tariffs against China underscores the ongoing risks and potential for further disruptions to global commerce.   

Billionaire investor Bill Ackman, a prominent Trump supporter, lauded the President’s decision to pause most tariffs, praising his rejection of “ideologies.” Meanwhile, logistics companies are reportedly experiencing a surge in activity as importers attempt to move goods before any potential reimposition of tariffs after the 90-day pause.   

Despite the market euphoria, some analysts remain cautious. The underlying trade tensions have not entirely dissipated, and the increased tariffs on China could still have significant negative consequences for US businesses and consumers.

The coming months will be crucial in determining whether this tariff pause represents a genuine de-escalation or simply a temporary lull in a broader trade conflict. The focus will now shift to how China responds to the increased tariffs and whether the US can leverage the 90-day window to achieve more favorable trade agreements with its other partners.

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