The three indices of the New York Stock Exchange advanced strong on Monday, with the technological sector leading the profits, after the White House announced a commercial truce with China. Both parties agreed to reduce their respective tariffs, which relieved the fears of prolonged commercial war.
In this context, the Dow Jones index of industrialists rose 2.81% to 42,410.10 points; The S&P500 won 3.26% to 5,844.44 points and Nasdaq Composite showed 4.35% to 18,708.34 points, returning to Alcista territory.
After the weekend negotiations in Geneva, China and the US agreed a 90 -day break in the growing mutually imposed tariffs. Washington decided to drastically reduce tariffs on China to 30% and Beijing those of US imports will be reduced to 10%, both countries reported in an unusual joint statement, after the important commercial negotiations held over the weekend.
According to strategists, the agreement is a “Mutually agreed tactic withdrawal”Not a perennial peace, despite the positive reaction of the market and the flexibility of tariffs.
Prior to the conversations, the US president, Donald Trump, had raised tariffs over China to 145%, which led to the Asian power to respond with 125% retaliation levies on US imports.
More commercial negotiations between the parties are planned, and both could make work level consultations on relevant economic and commercial issues.
“The tone of stock markets has been bassist during the last two months, weighed by fear for the effects of a possible tariff war and other hard hand measures of Donald Trump, but the situation shows indications of some stabilization and even moderate rebounds have been observed in the last sessions,” said Alberto Matellan, general director of the Financial Responsible, Investment Society in Paris, France.
“All this is explained by the loss of confidence caused by the White House, something that has not been reversed; however, if progress is made towards a lighter scenario, the market performance will be positive.
The opinion of the Federal Reserve
The governor of the Fed Adriana Kugler said that Trump’s administration tariff policies will probably boost inflation and include economic growth, even after the recent announced reduction of tariffs to China. “Commercial policies are evolving and they are likely to continue changing”Kugler said according to Bloomberg.
“Even so, they seem likely to generate significant economic effects, even if the tariffs are maintained close to the levels currently announced,” he said, and also said that the average tariff rates in the US remain much higher than they have been in numerous decades.
“If tariffs remain significantly higher than at the beginning of the year, the same is likely to occur with economic effects, which will include greater inflation and slower growth,” he added.
The technological sector led the profits
Technological actions, such as those of Amazon (+8%), Alphabet (+3.4%) and Apple (+6.3%) shot after the commercial agreement between the US and China. Apple confidence was also backed by a report by the Wall Street Journal that indicated that the technological giant is considering raising the prices of its star product, the iPhone, without blaming tariffs.
Actions related to China, such as PDD holdings (+2.2%), Alibaba Group Holdings (5.7%) and Baidu (+5%) recorded a strong rebound.
In the corporate sector, Pfizer’s actions (+3.3%), Eli Lilly (+2.8%) and Johnson & Johnson (-0.2%) closed disparate after President Donald Trump announced that he would reduce the prices of prescription medications by 59%, but did not provide more details about his plan to reduce their costs.
On the other hand, Chevron (-1.6%) and Exxon Mobil (-1.6%) also closed with mixed numbers, amid the increase in crude oil prices, after the commercial agreement between the two largest oil consumers in the world.
Dole’s actions fell 9% when the company reported a benefit per action (BPA) of the first quarter below the analysts’ expectations.
Kindlymd’s shares shot more than 275% after the announcement of a definitive merger agreement with Nakamoto Holdings, a Bitcoin -centered company. The association marks a strategic movement towards the Bitcoin Treasury for Kindlymd.
Source: Ambito
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