Stocks rally as Trump soothes fears over China trade, Fed

(FILES) A photograph, taken with a zoom effect, shows the CAC 40 amongst stock tickers displayed at the headquarters of the Pan-European stock exchange Euronext, in La Defense district, near Paris, on March 9, 2020. Paris’ CAC40 stock market closed 4,26% lower, as European markets fell on April 4, 2025, as equities and oil prices extended a global rout for markets after China hit back over President Donald Trump’s tariff blitz with its own mammoth levy on US goods, inflaming global trade war fears. (Photo by Eric PIERMONT / AFP)

Wall Street’s main equity indices, which had already gained more than two percent on Tuesday, rose again Wednesday.

The broad-based S&P 500 finished 1.7 percent higher.

Markets are climbing on “any headline that’s less negative on trade,” said Art Hogan of B. Riley Wealth Management.

“We’ve moved into a slightly more positive position but we still don’t know what the endgame will be on trade,” Hogan said

European stock markets also rallied, with Frankfurt gaining more than three percent.

Meanwhile, data showed that business activity in the eurozone remained “broadly unchanged” in April as manufacturing held up in the face of US tariffs despite waning confidence for the year ahead.

In Britain, however, the purchasing managers’ index tumbled more than expected to a two-and-a-half-year low.

On trade, Washington has imposed additional tariffs of 145 percent on a range of products from China, while Beijing has replied with 125 percent duties on imports from the United States.

Trump acknowledged that the US levies were at a “very high” level and that it would “come down substantially”.

On Wednesday, Treasury Secretary Scott Bessent told reporters Washington is “not yet” speaking with Beijing on tariffs, calling today’s prohibitively high levies from both countries not “sustainable.”

Gold, which had hit a record high above $3,500 Tuesday on a rush to safety, retreated to around $3,300 an ounce, while the dollar clawed back some of its recent losses against the pound, euro and yen.

“Looking at the dollar’s more muted reaction, you get the feeling that it is more of a reluctant view that Trump is slowly backing down on trade tariffs. It is actions that count,” said City Index and FOREX.com analyst Fawad Razaqzada.

In Asia, Hong Kong stocks surged on the back of a rally in tech firms including Alibaba and Tencent, and Tokyo’s stock market also gained.

Taipei jumped more than four percent, helped by a seven percent surge in chip titan TSMC.

– Key figures at 2030 GMT –

New York – Dow: UP 1.1 percent at 39,606.57 (close)

New York – S&P 500: UP 1.7 percent at 5,375.86 (close)

New York – Nasdaq Composite: UP 2.5 percent at 16,708.05 (close)

London – FTSE 100: UP 0.9 percent at 8,403.18 (close)

Paris – CAC 40: UP 2.1 percent at 7,482.36 (close)

Frankfurt – DAX: UP 3.1 percent at 21,961.97 (close)

Tokyo – Nikkei 225: UP 1.9 percent at 34,868.63 (close)

Hong Kong – Hang Seng Index: UP 2.4 percent at 22,072.62 (close)

Shanghai – Composite: DOWN 0.1 percent at 3,296.36 (close)

Euro/dollar: DOWN at $1.1317 from $1.1421 on Tuesday

Pound/dollar: DOWN $1.3257 at $1.3332

Dollar/yen: UP at 143.49 yen from 141.57 yen

Euro/pound: DOWN at 85.34 pence from 85.67 pence

Brent North Sea Crude: DOWN 2.0 percent at $66.12 per barrel

West Texas Intermediate: DOWN 2.2 percent at $62.27 per barrel

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© Agence France-Presse