Trump Authorizes 90-Day Pause on Reciprocal Tariffs, Stocks Skyrocket

Amid a global market meltdown, President Donald Trump abruptly reversed course by pausing most of his tariffs on U.S. trade partners for 90 days, while sharply increasing the tariff rate on Chinese imports to 125 percent.

"I have authorized a 90 day PAUSE," Trump said, after recognizing the more than 75 countries that he said have been negotiating on trade and had not retaliated against his latest increase in tariffs.

Speaking to reporters outside of the White House on Wednesday, the president said about this tariff pause, "I thought that people were jumping a little bit out of line. They were getting yippy, you know. They were getting a little bit yippy, a little bit afraid."

Why It Matters

Investors have been eager for President Trump to scale back his tariffs, which many economists warn could contribute to a global recession and drive inflation higher.

What to Know

The S&P 500 surged 9.5 percent, rebounding sharply after a rocky start to the day driven by fears that President Trump's escalating trade war could tip the economy into a recession.

The Dow Jones Industrial Average soared by 2,962 points on Wednesday, a gain of 7.9 percent, while the Nasdaq composite jumped 12.2 percent.

The S&P 500 posted its third-strongest daily performance since 1940. Prior to the surge, the S&P 500—which is central to many Americans' 401(k) retirement accounts—had been down nearly 19 percent from its all-time high set less than two months ago.

Wednesday's rally helped lift the S&P 500 out of the danger zone for what Wall Street terms a "bear market"—a deeper, more prolonged downturn that begins when stock prices fall 20 percent or more from recent highs.

White House press secretary Karoline Leavitt addressed concerns surrounding Trump's decision to impose tariffs, calling them a strategic negotiation tool. During a briefing outside the White House with Treasury Secretary Scott Bessent, Leavitt remarked that many reporters failed to understand the logic behind Trump's approach, referencing his book The Art of the Deal.

Leavitt also pushed back against the notion that the tariffs would push U.S. allies into China's sphere of influence. "In fact, we've seen the opposite effect. The entire world is calling the United States of America, not China," she stated. "They need our markets, they need our consumers, and they need this president in the Oval Office."

She further claimed that over 75 countries had contacted the U.S. to begin discussions. The retaliatory tariffs on goods from China and other countries came into effect just after midnight.

Bessent said Wednesday that Trump's pause won't impact sectoral tariffs, which will reportedly be imposed soon, and include products such as pharmaceuticals and lumber.

What People Are Saying

Scott Lincicome, VP, General Economics, Cato Institute, told CNN, "Markets are relieved a bit, but I don't know how you could possibly think the U.S. is a sound, safe and stable place to invest when the president is flipping tariffs on and off like a light switch and there could be more of these things in a mere 90 days. So, a bit of a reprieve, but we're definitely not out of the woods."

Republican Sen. Rand Paul of Kentucky said about the tariff pause, "I hope there's a lesson learned. When you add a bunch of tariffs, you'll lose six trillion in the marketplace. When you get rid of the tariffs, guess what, it comes bounding back."

Commerce Secretary Howard Lutnick wrote on X, formerly Twitter, on Wednesday, "Scott Bessent and I sat with the President while he wrote one of the most extraordinary Truth posts of his Presidency. The world is ready to work with President Trump to fix global trade, and China has chosen the opposite direction."

Democratic Sen. Adam Schiff of California said in a statement, "I'm writing to the White House to demand who knew in advance that the President was going to, once again, flip flop on tariffs. And are people cashing in? There is just all too much opportunity for people in the White House and the administration to be insider trading."

The China Ministry of Commerce warned Thursday, "If the U.S. insists on further escalating its economic and trade restrictions, China has the firm will and abundant means to take necessary countermeasures and fight to the end."

What Happens Next

The trade war isn't over. Both President Trump and Bessent made clear their continued frustration with China, which has been steadily increasing tariffs on U.S. goods and announcing countermeasures in response to each of Trump's moves.

Later, the U.S. Treasury Secretary delivered a pointed message to the global community—most notably China—saying, "Do not retaliate, and you will be rewarded."

Oil prices recover after Trump announces tariff pause

Oil prices swung sharply on Wednesday, initially plunging to a four-year low on fears of slowing global economic growth amid an escalating trade war, then rebounding after President Donald Trump announced a 90-day pause on most tariffs.

U.S. benchmark crude reversed course alongside the broader markets, climbing 2 percent —or $1.20—to settle at $60.79 per barrel following the Trump administration's latest shift in trade policy.

Earlier in the day, prices had tumbled as much as 4.3 percent to $56.98 per barrel, briefly touching levels not seen since February 2021 during the height of the COVID-19 pandemic.

Update: 4/9/25, 2:03 p.m. ET: This article has been updated with additional information.

Update: 4/9/25, 2:13 p.m. ET: This article has been updated with additional information.

Update: 4/9/25, 2:38 p.m. ET: This article has been updated with additional information.

Update: 4/9/25, 2:46 p.m. ET: This article has been updated with additional information and remarks.

Update: 4/9/25, 3:15 p.m. ET: This article has been updated with additional information and remarks.

Update: 4/9/25, 5:03 p.m. ET: This article has been updated with additional information and remarks.

Reporting by the Associated Press contributed to this story.