'Day to Remember': Trump's 90-Day Tariff Pause Results in Historic Gains on Wall Street, 3rd Best Day for S&P 500 Since 1940

New York: Trump's announcement of a 90-day tariff pause for most nations except China, has brought about a lot of joy and euphoria on the Wall Street with historic gains and respite from what looked like a prelude to a global recession in the past days.

Markets Surge As Trump Announces Tariff Pause, Wall Street Witnesses Historic Gains

The Wall Street had one of its most remarkable sessions on Wednesday, driven by a wave of joy and optimism after President Donald Trump announced a temporary tariff pause for most countries, excluding China - something investors had been anxiously hoping for.

Also Read: Donald Trump’s Big Relief On Tariffs, Announces 90-Day Pause For 75 Countries Except For China

Earlier in the day, markets had been under pressure, rattled by fears that Trump’s aggressive trade policies might tip the global economy into recession. But sentiment shifted dramatically after the president took to social media to reveal a change of course. Investors, previously worried that Trump might disregard the financial market fallout from his tariff strategy, welcomed the reversal. 

Dow Jones Surged 7.9&, Nasdaq Saw 12.2% Jump - Check Latest Update

Although the trade standoff remains unresolved and volatility could return, markets celebrated the temporary relief. 

• The Dow Jones Industrial Average surged 2,962 points, a 7.9% increase; the stocks rose by 2,962.86 to finish at 40,608.45.
• The tech-heavy Nasdaq jumped 12.2% - the Nasdaq composite added 1,857.06 points to reach 17,124.97.
• Delta Air Lines jumped 23.4% despite withdrawing its financial guidance for 2025 earlier in the day, citing uncertainty from the trade conflict. 

Trump Tariff Pause: S&P Skyrocketed, Registered 3rd Best Day Since 1940

The S&P 500 enjoyed its third-strongest day since 1940, skyrocketed by 9.5%, a surge that would typically represent a solid annual gain - it climbed 474.13 points to close at 5,456.90. Nearly all S&P 500 stocks participated in Wednesday’s rally, with about 98% of the index’s components seeing gains. Airline and travel-related stocks were among the top performers, as improved investor sentiment could signal a return of consumer confidence.

The S&P 500 had recently been nearing bear market territory—defined as a 20% drop from its peak—after falling nearly 19% from its all-time high. Wednesday's rally helped the index recover some ground, now sitting 11.2% below its record.

Also Read: US Tariff Twist: Global Markets Rebound As Donald Trump Announces 90-Day Reprieve For Most Nations

How Global Markets Reacted to Trump's Big Respite

Global markets reacted differently, as many international exchanges closed before Trump’s tariff announcement. European and Asian markets fell broadly—London’s FTSE 100 declined 2.9%, Japan’s Nikkei 225 dropped 3.9%, and France’s CAC 40 lost 3.3%. However, Chinese markets bucked the trend, with Hong Kong’s Hang Seng gaining 0.7% and the Shanghai Composite climbing 1.3%.

Treasury Yields Recede After Sudden Surge, Give Way to Smooth Bond Auction

Adding to the market’s positive momentum, the U.S. government’s Treasury bond auction went smoothly on Wednesday. Earlier in the day, bond yields had jumped sharply, which signaled rising concern in the financial markets. President Trump even remarked that the bond market was “getting a little queasy.”

There were several possible reasons for the spike in yields. Some experts believe that big investors, like hedge funds, were selling off bonds to raise cash after taking losses in the stock market. Others pointed to foreign investors pulling back on U.S. bonds because of the ongoing trade tensions. When bond prices fall, their yields or interest rates go up.

Usually, during uncertain times, investors buy Treasury bonds as a safe place to park their money, which pushes yields lower. But this week was different. The 10-year Treasury yield briefly hit 4.50% on Wednesday morning before easing to 4.34% after Trump paused some tariffs and the bond auction ended successfully. Still, that’s higher than 4.26% on Tuesday and much higher than 4.01% just a week earlier.

‘I Have Authorized A 90-Day Pause’: Trump's Big Announcement

"I have authorized a 90 day PAUSE," Trump posted, acknowledging over 75 nations engaged in trade discussions and choosing not to retaliate against his recent tariff hikes. Later, Treasury Secretary Scott Bessent clarified that the pause would affect most major trading partners, although a 10% tariff on nearly all imports would remain in place. 

US-China Tensions Deepen As Trump Excludes Chinese Goods from Tariff Pause

Notably, China was excluded from the tariff pause and Trump also announced that tariffs on Chinese goods would rise sharply to 125%, keeping tensions between the two economic giants alive.

China announced plans to raise tariffs on US imports to 84% starting Thursday. In a strongly worded response, Beijing stated that it would take further action if the US escalated trade restrictions. “If the US insists on further escalating its economic and trade restrictions, China has the firm will and abundant means to take necessary countermeasures and fight to the end,” said the Chinese Ministry of Commerce.

In a message that seemed aimed particularly at Beijing, Treasury Secretary Bessent cautioned: “Do not retaliate, and you will be rewarded.”