World / Business

Stocks spring higher, dollar gains as Trump announces tariff pause excluding China

07:03 am on 10 April 2025

By Caroline Valetkevitch

Traders work on the floor of the New York Stock Exchange (NYSE) at the opening bell on April 9, 2025, in New York City. Wall Street stocks were mixed in early trading Wednesday as markets digested the latest tariff hike by the United States and retaliatory moves by China and the European Union.

Traders work on the floor of the New York Stock Exchange (NYSE) at the opening bell on 9 April, 2025, in New York City. Photo: AFP

Traders work on the floor of the New York Stock Exchange (NYSE) at the opening bell on 9 April, 2025, in New York City.

  • US Treasury yields pare gains after auction
  • Trump tariff announcement drives stocks sharply higher
  • Dollar up vs yen and other currencies

Markets react to Trump's new tariff announcements

Major stock indexes have shot higher, with the Nasdaq last up about 10 percent, after US President Donald Trump said he had authorized a 90-day pause on many of his reciprocal and 10 percent tariffs, effective immediately, even as he raised them on China.

The US dollar - which had been lower earlier on Wednesday (local time) - strengthened against the yen and other currencies after Trump's announcement, while Treasury yields pared gains after an auction of 10-year Treasury notes saw strong demand. Trump declared a 90-day pause on reciprocal and 10 percent tariffs that he had unveiled initially last week, while raising duties on China.

Trump's unveiling of sweeping tariffs late last Wednesday had rattled markets, with stocks selling off sharply in the days following the announcement.

"This was definitely a surprise, considering that the administration consistently said they would not back off the tariffs and that they were non-negotiable," said Steve Sosnick, chief market strategist at Interactive Brokers in Greenwich, Connecticut.

"That said, the magnitude of the rally shouldn't be surprising..." he said. "This is a very understandable relief rally."

Many investors have been worrying that Trump's wide-ranging tariffs could be severe enough to trigger a recession.

The Dow Jones Industrial Average rose 2,541.92 points, or 6.73 percent, to 40,180.98, the S&P 500 rose 392.26 points, or 7.87 percent, to 5,375.03 and the Nasdaq Composite rose 1,529.03 points, or 10.00 percent, to 16,794.65.

Stocks had been higher on Wednesday before the announcement, and US indexes added to gains following the Treasury auction.

MSCI's gauge of stocks across the globe rose 33.55 points, or 4.52 percent, to 776.51.

Against the Japanese yen, the dollar strengthened 1.25 percent to 148.08.

The yield on benchmark U.S. 10-year notes rose 17.1 basis points to 4.431 percent, from 4.26 percent late on Tuesday.

- Reuters