US stocks jump as trading partners rush to negotiate with Trump on tariffs

US stocks jumped Tuesday morning after a massive, multi-day rout as nations overseas rushed to negotiate with President Trump on his stiff series of “reciprocal” tariffs.

The Dow Jones Industrial Average jumped 1,238 points, or 3.2%, after losing more than 3,500 points since Wednesday as investors panicked over Trump’s “Liberation Day” taxes, which economists have warned could reheat inflation and even trigger a recession.

The S&P 500 rose 3.3%, and Nasdaq 100 futures jumped 3.6% following reports of negotiations across multiple countries and possible concessions from major trade partners.

Wall Street took a wild ride after Trump unveiled his most expansive batch of tariffs yet, including a 10% baseline tax on all imports that took hold over the weekend and much harsher rates on many nations set to take effect Wednesday.

Economists warned the tariffs could reheat inflation, as many producers will likely pass along at least some of the import tax to consumers. 

JPMorgan and Goldman Sachs hiked their odds of a recession to 60% and 45%, respectively, as stocks cratered and suffered their worst losses since the COVID-19 pandemic.

Markets took a beating Monday morning after the president over the weekend signaled his tariffs wouldn’t be revoked anytime soon — but news of trade talks with several countries once again fueled hopes on Tuesday that the hefty tariffs could be negotiated lower.

Trump, in a Truth Social post on Monday afternoon, revealed he spoke with Japanese Prime Minister Shigeru Ishiba that morning.

Treasury Secretary Scott Bessent later said Trump asked him and the US trade representative to “open negotiations” with Ishiba and his cabinet and that he was tasked with leading trade talks with Japan — which is facing a 24% “Liberation Day” levy.

“Japan remains among America’s closest allies, and I look forward to our upcoming productive engagement regarding tariffs, non-tariff trade barriers, currency issues, and government subsidies,” Bessent said in a post on X. 

Indonesia also appeared eager to rush to the negotiating table ahead of Trump’s 32% tax on the country, set to take effect Wednesday.

The Southeast Asian nation plans to send a high-level delegation to the US next week in pursuit of a deal, but on Tuesday, it announced several concessions, including buying more from the US and lowering import taxes.

Indonesia plans to buy liquefied petroleum gas, liquefied natural gas, and soybeans from the US, the nation’s chief economic minister, Airlangga Hartarto, said at a meeting to discuss a response to the tariffs.

The trade partner also plans to lower import taxes on steel, mining products, and health equipment from the US, and electronics, mobile phones, and laptops from any country, Finance Minister Sri Mulyani Indrawati added.

She implied there’s wiggle room in these negotiations for Indonesia to replace manufacturing-dominant Vietnam, Bangladesh, Thailand, and China as a prominent source of exports to the US.

Vietnam also offered further concessions after White House trade adviser Peter Navarro said its initial offer to ax tariffs on the US altogether was not enough.

“When they [Vietnam] come to us and say ‘We’ll go to zero tariffs,’ that means nothing to us because it’s the non-tariff cheating that matters,” Navarro told CNBC’s “Squawk Box.”

But investors enjoyed some consolation that the major trade partner could avoid Trump’s 46% tariff, as Vietnam late Monday offered to buy more US goods, including security and defense products, as it seeks an 11th-hour pause on the tax.

Vietnam will “approach and negotiate with the US to reach a bilateral agreement, moving towards a sustainable trade balance,” Prime Minister Pham Minh Chinh said in a statement.

It would also “continue to buy more US products that are strong and Vietnam has demand for, including products related to security and defense; promote early delivery of aircraft trade contracts,” the prime minister added.

Vietnam has asked Trump for at least a 45-day delay on the incoming tariff.

With Post wires