Global Market Shows Recovery Rally As Trump Announces 90-Day Pause On Tariff

Global benchmark indices showed a recovery rally as US President Donald Trump announced a 90-day pause on new tariffs for more than 75 countries, excluding China. The announcement was made on Wednesday, April 9, sparking one of the strongest global equity rallies. "I have authorised a 90-day PAUSE,” Trump said. He acknowledged countries have been negotiating on trade and had not retaliated against his recent tariff hikes.

Markets responded instantly. The Dow Jones Industrial Average rocketed 2,962.86 points, or 7.87 per cent, to close at 40,608.45. The S&P 500 gained 474.13 points, or 9.52 per cent, to 5,456.90, its biggest one-day gain since 2008. The Nasdaq Composite jumped 1,857.06 points, or 12.16 per cent, to end at 17,124.97, marking its second-largest single-day rise on record.

The relief extended far beyond Wall Street. The MSCI’s global equity index rose 5.70 per cent to 785.28. In Europe, futures surged more than 9 per cent after the rally in U.S. markets, as per Reuters.

The small-cap Russell 2000 Index also increased by 8.66 per cent, or 152.45 points, to 1,913.16, its most significant one-day jump since March 2020.

A positive trend soon was mirrored by Asian Markets, Japan’s Nikkei opened over 10 per cent, while South Korea's Kospi surged to 5.6 per cent.

Trump’s announcement paused recently imposed reciprocal tariffs on 57 trade partners, including the European Union, Japan, and South Korea. These countries will now see a flat 10 per cent import tariff during the 90-day window. Nations like Brazil, Australia, the U.K., and Colombia, which have already been facing baseline 10 per cent tariffs since April 5, will remain at those rates for now.

However, China was explicitly excluded from the tariff freeze. Following Beijing’s announcement of an 84 per cent tariff on U.S. goods, the White House retaliated by raising tariffs on Chinese imports to a staggering 125 per cent. This latest hike brings the cumulative duties imposed on Chinese goods since Trump took office to a new high.

Goldman Sachs quickly adjusted its economic outlook in response. “Earlier today, before President Trump’s announcement, we had shifted to a recession baseline,” Goldman’s chief economist Jan Hatzius said in a note. “We are now reverting to our previous non-recession baseline forecast.”

Oil markets also rallied. Brent crude closed up $2.66, or 4.23 per cent, at $65.48 a barrel. The U.S. West Texas Intermediate crude climbed $2.77, or 4.65 per cent, to $62.35, as per Reuters.

The announcement caps a turbulent week on the heels of Trump’s so-called “Liberation Day” tariff policy, which had rattled global markets.