Wall Street shares surge greater on rising hopes of tariff offers
Stocks are surging on Wall Street and around the world – offering a slight reprieve from the carnage of the past few days.
Investors, from big hedge funds to Americans with 401(K)s, are trying to recover some of the historic losses since President Donald Trump announced sharp increases in taxes on goods imported to the US.
Trump announced on Truth Social a ‘great call’ with South Korea’s acting president and noted China’s strong interest in striking a deal. It comes as White House officials have also hinted that the US is negotiating with trading partners.
The S&P 500 was up 3.4 percent in early trading Tuesday. The Dow Jones Industrial Average was up 1,230 points, or 3.3 percent, and the Nasdaq composite was 3.6 percent higher.
Overseas markets also rose sharply, and the price of U.S. crude oil rose a bit after touching its lowest level in four years. Market watchers say more big swings up and down are likely as the tariff conflict plays out.
World shares advanced Tuesday, led by gains in Tokyo where the Nikkei 225 shot up just over 6 percent as markets settled after the shocks from President Donald Trump’s tariff hikes.
Japan’s Nikkei newspaper reported Tuesday that U.S. Treasury Secretary Scott Bessent would lead trade negotiations with the country, which as been buffeted by an escalating trade war kicked off by Trump.
Such negotiations are typically led by trade representatives, the Nikkei reported citing unnamed sources, hinting that currency imbalances may also be part of the reported talks.
Stocks surged
Tuesday’s rebound followed a wild day on Wall Street on Monday, where stocks careened after Trump threatened to crank his double-digit tariffs higher.
On Tuesday, China’s Commerce Ministry said it would ‘fight to the end’ and take unspecified countermeasures against the United States after Trump threatened another 50 percent tariff on Chinese imports.
Among the early gainers was Levi Strauss, which climbed more than 10 percent after beating analysts’ profit targets and forecasting a strong 2025, despite the ongoing trade war and tariff threats.
CVS Health climbed more than 8 percent after the drugstore chain named a new chief financial officer, effective later this month.
Shares of health insurers like Humana, United Health and Elevance rose sharply after the Centers for Medicare & Medicaid Services announced a 5.06 percent increase in Medicare payments for next year, which was stronger than expected.
Corporate earnings season kicks off this week with Delta Air Lines reporting on Wednesday and major US banks offering up their latest results on Friday. The airline sector., which had been forecasting a strong 2025, has been one of the hardest hit during Trump’s tariff rollout.
Banks report their latest quarterly earnings on Friday, but most of the attention likely will be on their forecasts amid the rising global trade tensions ignited by Trump’s tariffs.
On Thursday, the government posts its latest inflation data, which could play into the Federal Reserve’s next interest rate decision. Many economists have raised their odds of a U.S. recession because of the tariffs and suggest the Fed may have to step in and cut rates to help spur economic growth.
He wrote that he was confused when the president held up his sign showing the amount of tariffs he would impose on 60 countries last Wednesday in what Trump dubbed Liberation Day
Economists across the world now worry of a global economic downturn
Trump’s trade war is an attack on the globalization that´s shaped today’s world economy and helped bring down prices but also caused manufacturing jobs to leave for other countries.
He has said he wants to bring factory jobs back to the United States, a process that could take years. Trump also says he wants to narrow trade deficits with other countries, but it´s unclear how much room for negotiation there is on the U.S. side or among its trading partners.
Indexes swung between losses and gains Monday, partly because investors are still hoping negotiations may forestall actual implementation of the stiff duties on all imports.
Hong Kong also recovered some lost ground, but nothing close to the 13.2 percent dive Monday that gave the Hang Seng its worst day since 1997, during the Asian financial crisis.
Hurt by worries that a global economy weakened by trade barriers will burn less fuel, the price of a barrel of benchmark U.S. crude oil dipped below $60 on Monday for the first time since 2021. Early Tuesday, it was up 18 cents at $60.88 per barrel..
Bitcoin gained about 6 percent to $79,550. On Monday it sank below $79,000, down from its record above $100,000 set in January.
