Key Points Summary: Trump Trade China

• Trump Trade China breakthrough sends Dow futures soaring over 1,000 points
• U.S. and China slash tariffs, signaling 90-day truce in trade war
• Dow, S&P 500, Nasdaq futures spike as investors celebrate de-escalation
• New deal cuts U.S. tariffs on China from 145% to 30%; China lowers U.S. tariffs from 125% to 10%
• ING calls this a “larger-than-expected” move; more talks expected soon
• Treasury Secretary Bessent says another round of negotiations will happen within weeks
• Markets expect further economic boosts if full trade pact materializes

Wall Street lit up like a rocket Wednesday morning after the White House stunned markets with a dramatic pause in the U.S.–China tariff war.

Dow Jumps Over 1,000 Points

U.S. stocks rallied Monday after the U.S. and China agreed to temporarily slash tariffs following negotiations over the weekend in Switzerland.

The Dow Jones Industrial Average surged 1,022 points, or 2.4%. The S&P 500 popped 2.6%, and the Nasdaq Composite surged 3.5%.

The 10-year Treasury yield climbed to 4.449%, as investors rushed into equities.

Trump Scores Tariff Victory

Effective immediately, the U.S. will slash its tariffs on Chinese imports to 30%, down from the punishing 145%. In return, China will drop its tariffs on American goods to 10%, down from a suffocating 125%.

The nations have agreed to a 90-day tariff pause to hash out a fuller agreement.

“This was a larger-than-expected de-escalation,” said Lynn Song, chief economist for Greater China at ING. “But the road ahead is still uncertain.”

Beijing Talks Called ‘Candid, Constructive’

China’s Vice Premier He Lifeng described the meetings as “candid, in-depth and constructive.” Chinese state media reported “substantial progress” and “important consensus.”

Photos of Lifeng and Treasury Secretary Scott Bessent shaking hands made headlines in Beijing.

Bessent, speaking to CNBC’s Squawk Box, confirmed another meeting is expected “in the next few weeks.”

“We’ll be rolling forward on a more fulsome agreement,” Bessent said.

Investors See Economic Lifeline

Tariff fears have haunted Wall Street for months. Investors worried that 100%+ tariffs would tank trade, choke growth, and drive inflation even higher.

Now, that nightmare appears to be paused — at least temporarily.

“This is the lifeline American manufacturers and farmers needed,” said one market analyst. “Lower tariffs mean lower costs — and possibly lower prices for consumers.”

Pharma Stocks Move as Trump Eyes Drug Order

While trade took center stage, President Trump teased another major move: an executive order to revive his “most favored nation” drug pricing plan.

He claims the move will slash some pharmaceutical prices “by 30% to 80% almost immediately.”

The plan ties Medicare drug prices to what other countries pay — a dramatic shift.

Though similar past efforts failed in court, Trump says this time it’s different.

“The American people will no longer be the world’s suckers when it comes to drug pricing,” he wrote on Truth Social.

From Tariffs to Triumph?

Market insiders are hopeful but cautious.

The 90-day pause gives negotiators breathing room. But many warn that deeper, thornier issues — like intellectual property and data controls — remain unresolved.

Still, Wednesday’s rally is a strong signal: investors want peace, not tariffs.

If Trump can pull off a full deal, markets may soar even higher.

What’s Next for Markets

Eyes will stay glued on upcoming meetings between Bessent and Chinese officials. Any hint of further progress could extend the rally.

Meanwhile, expect continued debate over Trump’s proposed drug order and its ripple effects.

One thing is clear: with one bold stroke, the president just reset both the trade war and the stock market.