U.S.-China Reach 90-Day Trade Ceasefire, Markets Rally on Tariff Cuts

In a major breakthrough announced in Geneva, the United States and China have agreed to a 90-day ceasefire in their ongoing trade dispute, accompanied by significant mutual tariff reductions. This move is aimed at easing economic tensions and allowing time for both sides to resolve deeper disagreements.

According to the joint statement, the U.S. will reduce its average tariff rate on most Chinese imports — currently totaling 145%, including levies related to fentanyl — to 30% by May 14. In return, China will lower its tariffs on American goods from 125% to 10%.

U.S. Treasury Secretary Bessent called the talks "very in-depth and productive," particularly in regard to future fentanyl controls. “Both sides agree that decoupling would be harmful,” she added.

Markets Respond Strongly

U.S. stock futures jumped early Monday after the U.S. and China agreed to temporarily slash tariffs following negotiations over the weekend in Switzerland.

Dow Jones Industrial Average futures

gained 1,009 points, or 2.4%. S&P 500

futures climbed 3.1%, and Nasdaq-100

futures surged 4.1%.

U.S. Treasury Secretary Scott Bessent said on Monday that talks with China had been “very productive” and both countries had agreed to cut “reciprocal” tariffs by 115% for 90 days. That brings U.S. tariffs on Chinese goods down to 30%, and Chinese tariffs on U.S. imports to 10%.

Tech and China-related stocks led the gains, reflecting hopes for improved trade flows and reduced regulatory risks.

$Alibaba(BABA)$ 

$Tesla Motors(TSLA)$ 

$NVIDIA Corp(NVDA)$ 

$Advanced Micro Devices(AMD)$ 

$Micron Technology(MU)$ 

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