This report is from today’s TNC’s Daily Open, our international markets update. TNC Daily Open keeps investors informed on everything they need to know, no matter where they are.
The U.S. and China agreed over the weekend to reciprocally reduce their 90-day tariffs from 125% to 10%. That is significantly more than anticipated, given that Trump stated on Friday that an 80% tariff on China “seems right!” The total charge on Beijing is 30% since the United States continues to impose a 20% fentanyl-related levy on China.
Even though it’s high, 30% is far less than 145%. Stocks soared as a result of the joyful investors. Consumer discretionary stocks like Nike and Starbucks, and tech companies like Nvidia and Broadcom saw a surge. The market mania reminded me of the “Trump put,” which holds that if the market declines, the president would take action to support it.
However, Dario Perkins, managing director of global macro strategy at TS Lombard, notes that it is “(sort of) of funny that the optimistic case for Trump 2.0 is basically that it will reverse most of what it has done so far. “
Perhaps a Trump put is simply the president restoring the status quo.
What To Note Today
U.S. and China Agree to 90-Day Tariff Truce
To ease trade tensions, the U.S. and China have reached a preliminary agreement suspending most tariffs for 90 days. Mutual tariffs will drop from 125% to 10%, though the U.S. will maintain a 20% duty on fentanyl-related Chinese goods. Treasury Secretary Scott Bessent described the deal as part of America’s broader strategy to reduce economic dependency on China.
Beijing Claims Victory in Trade Talks
While President Trump said China has agreed to “open up,” Chinese officials and state-backed media portrayed the deal as a win for Beijing’s tough negotiating stance. Influential Chinese voices celebrated the agreement as proof of China’s strength and resilience in trade diplomacy.
Markets Surge on Trade Deal Optimism
News of the U.S.-China truce sparked a sharp rally in global markets. The S&P 500 jumped 3.26%, the Dow gained nearly 3%, and the Nasdaq soared over 4%. European markets also climbed, while Maersk shares surged 10%. Bond yields and oil prices rose as recession fears eased.
Tech Stocks Lead Wall Street Rally
Tech giants in the “Magnificent 7” group collectively added $837.5 billion in market value—their biggest single-day gain in over a month. Consumer-focused stocks followed suit. The rally revived talk of the “Trump put,” the belief that the president may act to stabilize markets during downturns.
S&P 500 Breaks Key Resistance Level
The S&P 500’s sharp rise pushed the index past a major technical threshold, surprising analysts. The sudden movement suggests that investors were not fully prepared for the trade news and could face more volatility as markets digest the implications.
Freight Boom Looms as Tariff Pause Sparks Shipping Rush
Logistics experts report a rush of U.S. importers to bring goods from China during the 90-day tariff suspension. Thousands of containers are queued up, and shipping costs are expected to spike. Retailers anticipate raising prices as freight demand and container rates surge.
