Markets Rebound as Trump Eases Tariffs—But China Still in the Crosshairs

Global Markets Rebound After Trump Pauses Most New Tariffs

President Donald Trump stunned global markets late Wednesday by suspending the majority of new tariffs he had just imposed on dozens of U.S. trading partners—offering a wave of relief to battered investors and markets worldwide.

The reversal came just hours after steep new duties took effect, and followed one of the most turbulent trading days since the early COVID-19 pandemic. The recent market upheaval wiped trillions of dollars in equity value and triggered a sharp rise in U.S. Treasury yields, reportedly drawing the president’s attention.

“I thought people were jumping a little bit out of line—they were getting yippy, you know,” Trump said during a press briefing, referencing the nervous energy often seen in athletes.

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Stock Markets Rally Globally

The S&P 500 soared 9.5% on Wednesday, posting one of its strongest daily gains in history. The rebound continued in Asian markets Thursday, with Japan’s Nikkei index surging 9%. European futures also pointed to substantial gains.

However, U.S. futures slipped slightly overnight, signaling that the market bounce may be short-lived as investors remain cautious.

Meanwhile, oil prices continued to decline, reflecting ongoing fears that the prolonged trade tensions could tip the global economy into a recession.

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China Still in the Hot Seat

While most countries were spared, China remained firmly in Trump's crosshairs. On Thursday, the administration escalated its stance by raising tariffs on Chinese imports to 125%, up from the 104% level implemented just a day prior.

Beijing had already retaliated on Wednesday by imposing 84% tariffs on U.S. imports, mirroring Trump’s earlier moves. Chinese officials have reiterated their commitment to “fight to the end” in what is now a full-blown trade war between the world’s two largest economies.