The U.S. stock market is surging on news that U.S. President Donald Trump has dropped tariff rates on imports from most of America’s trade partners to 10% for 90 days to allow for negotiations.
The blue-chip Dow Jones Industrial Average is up more than 2,000 points and the technology-laden Nasdaq Composite index is up more than 10% on news of the de-escalation in what had become a global trade war. The benchmark S&P 500 index was up as much as 9% in early afternoon trading on April 9.
Stocks rebounding strongly on the tariff pause include consumer electronics giant Apple (AAPL), chipmaker Nvidia (NVDA), and electric vehicle maker Tesla (TSLA), each of which shot up more than 10%. Investors were quick to buy stocks as news of the tariff relief spread.
China Tariffs
It wasn’t immediately clear if the tariff pause includes China. Earlier in the day, China announced new tariffs of up to 84% on imported U.S. goods in retaliation to America slapping a 104% tariff on Chinese products. The prospect of the world’s two biggest economies entering a trade war had rattled financial markets.
The stock market fell sharply in the week since President Trump announced sweeping reciprocal tariffs on more than 100 countries worldwide, with the S&P 500 dropping more than 12% and the Nasdaq entering a bear market defined as a decline of 20% or more from recent highs. There were also growing signs of trouble in the bond market with prices falling and yields rising early on April 9.
Is the Vanguard S&P 500 ETF a Buy?
The Vanguard S&P 500 ETF (VOO), which tracks the movements of the benchmark U.S. stock index, has a consensus Moderate Buy rating among 506 Wall Street analysts. That rating is based on 409 Buy, 89 Hold, and eight Sell recommendations made in the last three months. The average VOO price target of $639.90 implies 31.59% upside from current levels.
