US Stock Market Surges on Breakthrough in US-China Trade Talks Podcast By cover art

US Stock Market Surges on Breakthrough in US-China Trade Talks

US Stock Market Surges on Breakthrough in US-China Trade Talks

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 On May 12, 2025, the US stock market experienced a significant surge, driven primarily by a breakthrough in US-China trade talks. The S&P 500 climbed 3.3 percent, or 184.28 points, to close at 5,844.19, marking its first move above the 200-day moving average in months.

The Dow Jones Industrial Average jumped 2.5 percent, or more than 1,000 points, shortly after the opening bell, while the Nasdaq Composite rose 3.4 percent. These gains were largely attributed to the announcement that the US and China have agreed to reduce tariffs on each other for a 90-day period as they work towards a broader trade agreement. Treasury Secretary Scott Bessent confirmed that the reciprocal tariffs would be cut from 125 percent to 10 percent during this period.

In terms of sector performance, technology stocks were among the top gainers. Shares of Amazon surged more than 7 percent, while Apple, Tesla, and Meta Platforms each rose about 5 percent. Chipmakers Nvidia and Broadcom also saw significant gains, with increases of more than 4 percent. Alphabet rose more than 3 percent, and Microsoft added about 1 percent.

The most actively traded stocks included the major technology companies, with Amazon, Apple, and Tesla leading the pack. The agreement between the US and China was the significant market-moving news event of the day, as it alleviated some of the trade tension that had been weighing on the market.

Looking forward, pre-market futures are likely to remain positive given the current momentum. Key events to watch for tomorrow include any further developments in the US-China trade negotiations and potential reactions from other global markets. Important upcoming earnings releases will also be closely monitored for their impact on market sentiment. The reduction in tariffs is expected to be a potential market catalyst, as it could lead to increased investor confidence and further market rallies.
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