Dow soars more than 400 points after Trump postpones 50% tariff on EU imports

Stocks surged on Tuesday as markets rebounded from last week’s tariff scare following President Trump’s decision to postpone new levies on the European Union after a weekend call with European Commission President Ursula von der Leyen.

The Dow Jones Industrial Average soared by more than 400 points — or 1.16% while S&P 500 climbed 1%. The Nasdaq Composite, an index dominated by tech stocks, jumped 1.9%, or 367 points.

Treasurys also rallied, sending the 10-year yield down from Friday’s close above 4.5%. The WSJ Dollar Index also strengthened after touching a multi-month low late last week.

The upswing came as investors welcomed signs of a diplomatic thaw in US-EU trade tensions. On Friday, markets slid after Trump threatened to impose a 50% tariff on EU imports within days, while also warning that foreign-manufactured iPhones could face tariffs.

But sentiment shifted after Trump confirmed the new duties would be delayed until July 9, giving both sides time to negotiate.

In a post on Truth Social early Tuesday, Trump said the European Union had reached out to schedule talks: “This is a positive event, and I hope that they will, FINALLY, like my same demand to China, open up the European Nations for Trade with the United States of America.”

EU trade chief Maroš Šefčovič said the bloc was committed to avoiding “the mutual pain of tariffs” and would accelerate talks with Washington in the coming weeks.

The White House has not publicly commented on the contents of the call between Trump and von der Leyen, though insiders say both sides are seeking a temporary framework to de-escalate tensions.

European stocks also rallied, with Germany’s DAX index hitting a record intraday high, as global investors cheered the delay in trade restrictions.

The bond market staged a global rally, with long-dated government debt rising sharply, especially in Japan, amid speculation that Tokyo may reduce long-bond issuance.

Elsewhere, gold prices fell nearly 2%, while Bitcoin hovered near $110,000, close to all-time highs.

Investors are also turning their attention to key catalysts ahead.

Chipmaker Nvidia is set to report earnings on Wednesday, with expectations high after its recent AI-fueled rally. Several other S&P 500 companies are also due to report this week, providing fresh insight into the health of corporate earnings.

Meanwhile, the Federal Reserve will release minutes from its latest policy meeting, which are expected to shed light on its inflation outlook and rate path. The central bank’s preferred inflation metric — the core PCE price index for April — is due later in the week.

Speaking Tuesday, Minneapolis Fed President Neel Kashkari called for caution in adjusting monetary policy.

“It makes sense to keep rates on hold until we have more clarity on the global trade outlook,” Kashkari said.

Fresh economic data released on Tuesday showed durable goods orders slipped in April — the same month Trump announced a fresh round of tariffs targeting strategic industries, adding another layer of uncertainty to the trade and growth picture.