Stocks Surge as Trump Increases Tariffs On China Even Further, Pauses Them For Non-retaliating Countries

Stocks are surging on Wednesday after President Donald Trump said he would implement a 90-day pause on tariffs to countries that have not retaliated against the levies announced by his administration. At the same time, he further hiked tariffs on China to 125%.

The S&P 500 climbed over 5% and the tech-heavy Nasdaq 100 did so almost 8% following the announcement, breaking with three days of heavy losses.

In a post on his social media platform, Truth Social, Trump said that "based on the lack of respect that China has shown to the World's Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately."

"At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other Countries, is no longer sustainable or acceptable," Trump added. Beijing has so far matched most levies imposed by Washington D.C., with the current figure being 84%.

China has not yet reacted to the latest announcement, but its Commerce Ministry said on Tuesday that tariffs were "completely groundless" and a "typical unilateral bullying practice." Moreover, it added that its countermeasures are "aimed at safeguarding its sovereignty, security and development interests, and maintaining the normal international trade order. They are completely legitimate," it added, vowing to "fight to the end."

Chinese leaders are reportedly confident they can come out on top of the tariff standoff, according to a report by The Washington Post on Wednesday.

Separately, Trump announced relief for countries that had not imposed retaliatory measures. "Based on the fact that more than 75 Countries have called Representatives of the United States, including the Departments of Commerce, Treasury, and the USTR, to negotiate a solution to the subjects being discussed relative to Trade, Trade Barriers, Tariffs, Currency Manipulation, and Non Monetary Tariffs, and that these Countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately"