Trump's Tariff Turnaround: Stocks Soar as He Backs Down on Duties

In a surprising shift, President Trump temporarily lowered tariffs on many countries, boosting U.S. stocks, while increasing pressure on China. This move followed volatility in the markets and is aimed at negotiating better trade terms. Despite the easing, new tariffs on Chinese goods remain in place.

In a dramatic policy reversal, U.S. President Donald Trump announced on Wednesday a temporary reduction of the hefty tariffs he recently imposed on dozens of countries, resulting in a significant surge in U.S. stock market indices. The decision comes amid escalating pressure on China and intense volatility in financial markets, marking one of the most tumultuous periods since the onset of the COVID-19 pandemic.

Less than a day after the implementation of new tariffs, and in response to a series of financial upheavals, Trump remarked, "I saw last night that people were getting a little queasy," as bond yields fluctuated widely. Since his return to the White House, Trump's erratic tactic of imposing then lifting tariffs has left global leaders and businesses uncertain about future market conditions.

Trump's latest decision to pause targeted tariffs for three months is intended to provide an opportunity for U.S. officials to negotiate with affected nations, with a focus on easing trade tensions. However, tariffs on Chinese imports will rise to 125%, escalating the economic standoff between the two superpowers. Despite the welcome market response, analysts caution that economic concerns and potential price hikes remain prevalent.

(With inputs from agencies.)