The US stock market surged on Monday after the United States and China reached a breakthrough agreement to temporarily suspend their steep reciprocal tariffs, easing fears of an extended trade war.
The Dow Jones Industrial Average rallied over 1,000 points, or 2.5%, while the S&P 500 gained 3%. The Nasdaq Composite, bolstered by tech stocks, led the charge with a sharp 3.8% rise.
Markets responded positively to the unexpected scale of tariff reductions. The US agreed to cut duties on Chinese imports from 145% to 30%, while China slashed tariffs on US goods from 125% to 10% for the next 90 days, providing temporary relief for investors and businesses.
Big Tech stocks, previously under pressure from trade tensions, staged a powerful comeback. Nvidia climbed over 4%, while Amazon, Apple, and Tesla also saw strong gains. The rally extended to commodities, with oil prices jumping alongside rising US dollar and Treasury yields.
Attention now shifts to upcoming US inflation data, including the Consumer Price Index (CPI) on Tuesday, followed by the Producer Price Index (PPI) and retail sales data later in the week.
Meanwhile, Fox Corp (FOXA) beat earnings expectations thanks to stronger ad revenues, with Sony, Alibaba, and Walmart set to report later this week.
