NEW YORK, May 12, 2025 — Wall Street kicked off the week with a major rally as the Dow Jones Industrial Average soared more than 1,000 points after the United States and China reached a surprise temporary tariff reduction agreement following high-level negotiations in Switzerland over the weekend.
The move triggered a wave of investor optimism and breathed new life into equities after months of global trade uncertainty.
📈 Market Reaction
- Dow Jones Industrial Average: +1,021 points (+2.5%)
- S&P 500: +2.9%
- Nasdaq Composite: +4%
Tech and industrial stocks led the gains, with mega-cap names like Apple, Nvidia, and Caterpillar seeing major intraday spikes.
🔍 Details of the U.S.-China Tariff Deal
According to Treasury Secretary Scott Bessent, both nations have agreed to cut “reciprocal tariffs by 115%” for a 90-day period. This brings:
- U.S. tariffs on Chinese imports down from 45% to 30%
- Chinese tariffs on U.S. goods from 25% to 10%
“Talks with China have been very productive,” Bessent said Monday on CNBC’s Squawk Box. “This agreement gives both sides breathing room while we work toward a more comprehensive trade pact.”
💬 Next Steps in Negotiations
The temporary truce is set to last 90 days, during which representatives from both countries will continue discussions aimed at resolving key issues including:
- Intellectual property rights enforcement
- Access to financial markets
- Agricultural and tech-sector regulations
Bessent noted that another round of negotiations with Beijing is expected within the next few weeks.
🌍 Global and Sector Impact
The ripple effects were felt globally:
- Asian markets closed higher, with the Hang Seng up 2.1%
- European stocks rallied across the board
Domestically, the biggest winners included:
- Tech stocks: Boosted by easing trade restrictions
- Manufacturers and exporters: Encouraged by reduced duties
- Retailers: Hopeful for lower import costs
Final Thoughts
This unexpected tariff detente between the world’s two largest economies has given investors a much-needed confidence boost and reignited hopes for long-term trade stabilization.
While uncertainty still looms, today’s surge suggests that markets are ready to rally behind progress — even if it’s temporary.
Stay tuned for updates as negotiations continue.
By ✍️ Yorlinda Ramìrez - MicuPost Team
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