US markets today: Wall Street rebounds sharply; Trump softens China stance sparks investor optimism
The S&P 500 surged 1.5% to recover more than half of Friday’s drop, its steepest since April.
The Dow Jones Industrial Average added 561 points, or 1.2%, while the Nasdaq composite jumped 2% as of 12:02 p.m.
Eastern time, AP reported.“Don’t worry about China,” Trump said on his social media platform Truth Social on Sunday.
He added that China’s leader, Xi Jinping, “doesn’t want Depression for his country, and neither do I.
The US wants to help China, not hurt it!!!”The shift followed Trump’s Friday comments, when he had accused China of being “a moral disgrace in dealing with other nations” and threatened an additional 100% tariff on Chinese imports starting Nov.
1, citing Beijing’s “extremely hostile” letter on rare earth export curbs.
China urged the US to resolve differences through negotiations rather than threats, stating online: “We do not want a tariff war but we are not afraid of one.”Trump’s backtrack ahead of Monday trading helped lift market sentiment, raising hopes that the world’s two largest economies could maintain a functioning trade relationship.The market’s volatility echoes April’s swings, when Trump’s “Liberation Day” tariff announcement initially shocked investors before a series of eventual relaxations.
Morgan Stanley strategists, led by Michael Wilson, said if trade tensions ease similarly this time, conditions could allow a rolling recovery into 2026.The S&P 500 had already been under pressure after a nearly continuous 35% run since April.
Analysts noted that the index remains near all-time highs, prompting concerns that stock prices are outpacing corporate profit growth, particularly in the artificial intelligence sector, where some see echoes of the 2000 dot-com bubble.Broadcom posted a 10% gain, the biggest in the S&P 500 on Monday, following its announcement of a collaboration with OpenAI to design custom AI accelerators.
Conversely, Fastenal fell 4.8% after slightly weaker-than-expected quarterly profits.Bank of America strategist Savita Subramanian expressed optimism that S&P 500 companies could outperform analyst expectations in the upcoming earnings season, citing the resilient US economy and a weaker US dollar that boosts overseas sales.Internationally, European markets edged higher, while Asian indexes saw mixed performances.
Hong Kong’s Hang Seng fell 1.5%, and Shanghai dropped 0.2% after China reported an 8.3% increase in global exports in September compared with a year earlier, its strongest growth in six months, reflecting a shift in Chinese manufacturers toward non-US markets.
