05/12/2025

Wall Street Equity Indexes Rally after U.S. Caves to China's Tariff Truce

Uncertainty remains as investors worry about future threats

Wall Street's three major indexes rallied sharply on Monday with the S&P 500 hitting its highest levels since early March as a China-U.S. agreement to temporarily slash tariffs brought some hopes for the easing of a global trade war, which President Donald Trump ignited in early April.

The U.S. and China announced on Monday that they would slash steep tariffs on each other for 90 days. The U.S. said it will cut tariffs imposed on Chinese imports to 30 percent from 145 percent while China said it would cut duties on U.S. imports to 10% from 125 percent.

Investors showed some relief by favoring riskier assets and turning away from more defensive bets, but they were still left waiting for clarity on where tariffs would ultimately settle.

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