Market Rally Amid Tech Tariff Relief Sparks Global Optimism

U.S. stocks joined a global rally after the White House exempted smartphones and computers from tariffs. Major indices gained, driven by technology shares. Still, the economic outlook remains uncertain, with ongoing trade negotiations and potential interest rate cuts on the horizon. European and Asian markets also saw substantial increases.

U.S. stocks aligned with a global rally on Monday as the White House announced exemptions for smartphones and computers from targeted tariffs, creating a boost predominantly within the technology sector. In response, the Dow Jones Industrial Average rose 1%, and the S&P 500 saw a 1.6% increase, while the Nasdaq lifted over 2%.

Despite recent gains, apprehension lingers as President Trump hinted at future tariffs. Meanwhile, U.S. government bonds attempted recovery amidst volatile policy shifts. This volatility left investors uncertain about future economic trajectories, as noted by Morgan Stanley strategists, who highlighted the likelihood of sustained market fluctuations.

Globally, European and Asian markets responded favorably. Europe's STOXX 600 index surged 2.5%, recovering from last week's losses, as did Asia-Pacific shares outside Japan, which grew by 1.5%. The technology and supply chain sectors were significant contributors to these gains, paralleling growth within major U.S. tech firms.

(With inputs from agencies.)