U.S. stock futures posted strong gains Monday after the U.S. and China announced a major step toward easing trade tensions. Treasury Secretary Scott Bessent said both nations agreed to reduce tariffs by over 100 percentage points, bringing them down to 10%, and implement a 90-day pause on new trade measures. The move sparked immediate optimism in global markets.
At 04:08 a.m. ET, U.S. equity futures were sharply higher:
- Dow E-minis jumped 822 points (1.99%)
- S&P 500 E-minis climbed 141.75 points (2.5%)
- Nasdaq 100 E-minis rose 666.25 points (3.31%)
- Russell 2000 futures advanced 3.5%
The CBOE Volatility Index (VIX), Wall Street’s so-called fear gauge, dipped below 20 points for the first time since March, indicating a significant drop in investor anxiety.
Aaron Hill, chief analyst at FP Markets, called the deal “a pivotal moment in global trade dynamics,” while cautioning that the 90-day window signals these concessions are part of an ongoing negotiation rather than a final settlement.
Tech and Energy Stocks Rally
Investor enthusiasm spilled over into equity sectors most sensitive to global trade, with megacap tech and chipmakers leading the charge.
Notable early movers include:
- Nvidia (NVDA): +4.6%
- Tesla (TSLA): +6.7%
- AMD (AMD): +4.9%
- Marvell Technology (MRVL): +7.5%
Energy stocks also rallied in tandem with crude oil, which surged more than 3% following the trade news. Major producers Chevron (CVX) and Exxon Mobil (XOM) saw their shares rise by about 2%.
The rally extended a recovery trend that began in early April, helped by resilient earnings reports and renewed hopes that a trade resolution would avert a global slowdown.
Pharma Stocks Lag; Key Data Ahead
Not all sectors benefited from Monday’s optimism. Pharmaceutical shares fell after President Trump renewed his push to align U.S. prescription drug prices with lower international benchmarks—30% to 80% below current U.S. prices.
Key losers:
- Pfizer (PFE): -2.1%
- Eli Lilly (LLY): -2.3%
- Johnson & Johnson (JNJ): -2.4%
Looking ahead, investors will closely watch:
- Tuesday: U.S. Consumer Price Index (CPI)
- Thursday: Producer Price Index and Retail Sales
- This Week: Earnings from Walmart (WMT), Cisco (CSCO), and Deere (DE)
- Public remarks from several Fed officials, including Chair Jerome Powell
With reduced trade tensions and positive market momentum, Wall Street is poised for a potentially bullish week—pending economic data and Fed tone.