Global stocks rally after Trump halts tariff hike

Global markets rebounded sharply on Thursday after US President Donald Trump unexpectedly announced a temporary suspension of new tariffs, calming investors after days of intense market turmoil.

The decision, which pauses many of the recently imposed tariffs for 90 days, marked a sudden reversal that sparked a global relief rally. Wall Street surged in response, with the S&P 500 jumping 9.5 percent on Wednesday, its biggest one-day gain in over a decade. Major US tech and industrial firms regained  USD 1.5 trillion in market value overnight.

Read more: China increases tariffs on US goods to 84% as trade conflict deepens

European markets followed the momentum. The STOXX 600 index rose 5.3 percent early Thursday, set for its strongest daily gain since March 2020.

Japan’s Nikkei soared 8 percent in Asia, and futures for major European indexes like the EuroStoxx 50 and Germany’s DAX climbed by a similar margin. UK FTSE 100 futures added 5.5 percent.

Bond markets also showed signs of stabilization. After a week of heavy selling, the yield on the 10-year US Treasury dropped to 4.29 percent, down from a peak of 4.52 percent the day before. The US dollar posted strong gains Wednesday but pulled back slightly during Thursday’s Asian session.

However, the tariff relief is partial. The White House confirmed that a 10 percent blanket tariff on most US imports remains in effect. Tariffs already in place on cars, steel, and aluminum are also unchanged.

Tensions with China are still escalating. Just a day earlier, Trump announced plans to raise tariffs on Chinese imports to 125 percent, up from 104 percent. In response, China increased tariffs on US goods to 84 percent and imposed restrictions on 18 American companies, primarily in the defense sector.

Chinese markets opened higher on Thursday, with the blue-chip CSI 300 index gaining 1.6 percent. “There’s relief, at least for now, that global trade isn’t completely grinding to a halt,” said Wong Kok Hong, head of equity sales at Maybank.

Despite the market bounce, analysts caution that uncertainty remains high, especially with no signs of easing in the broader US-China trade conflict.