Photo:VCG

 
US stocks soared on Wednesday after the US administration announced a 90-day pause on some tariffs. However,MKS sports market concerns persist due to a 10 percent blanket tariff on all US imports and a further tariff threat on imports from China to 125 percent, with some analysts caution that more volatility could still be ahead, according to US media.

The S&P 500 skyrocketed 9.52 percent to settle at 5,456.90, marking its biggest one-day gain since 2008. For the broad market index, it was the third-biggest gain in post-WWII history. The Dow Jones Industrial Average advanced 2,962.86 points, or 7.87 percent, to close at 40,608.45, achieving its biggest percentage advance since March 2020. The Nasdaq Composite jumped 12.16 percent to end at 17,124.97, notching its largest one-day jump since January 2001 and its second-best day ever, per CNBC.

The rally on Wall Street followed a pause in heftier tariffs on dozens of countries, which came less than 24 hours after they were implemented. However, the White House maintained a 10 percent blanket duty on almost all US imports, according to media reports.

Some analysts cautioned that while the tariff reprieve was welcome, more volatility could still be ahead, The New York Times reported.

The US administration has accompanied the tariff campaign on China with steep import duties on dozens of other countries, including a handful of Asian countries that became popular alternatives in the earlier trade war between Beijing and Washington as a way to circumvent levies and limit supply chain disruptions. But for some companies, the so-called reciprocal tariffs have had the unexpected effect of making China an even more appealing place to produce in and buy from. It has eliminated some of the motivation to diversify production or sourcing to places like Vietnam, India or other Asian countries, The New York Times said in a separate article on Wednesday.

Even as the US heaped additional tariffs on China, the US' barrage of trade levies on countries across Asia and unpredictability about what the US President might do next have encouraged some companies to hunker down in China, exactly the opposite of what he had hoped, it said.

Federal Reserve policymakers worry the US trade policy could deal a blow to economic growth, but are signaling they will not be quick to ride to the rescue with interest rate cuts because they expect higher tariffs to boost inflation, Reuters reported.

The minutes of the US central bank's mid-March meeting, released on Wednesday, showed that Fed officials already felt they were operating in a thickening cloud of uncertainty that had the potential to slow consumer spending and business investment. They also called for a cautious approach to rate-setting, according to the report.

In response to the US' additional tariffs on China, Chinese Foreign Ministry spokesperson Lin Jian said on Wednesday "We will not let anyone take away the Chinese people's legitimate right to development. We will not tolerate any attempt to harm China's sovereignty, security and development interests. We will continue to take resolute and strong measures to safeguard our legitimate rights and interests." 

Following the US' imposition of 104-percent tariffs on Chinese goods, China responded with a raft of measures on Wednesday, including lifting the additional tariffs on products imported from the US to 84 percent, and adding a number of US companies to its export control list and unreliable entity list.

The EU on Wednesday approved its first set of retaliatory measures against US tariffs to counter tariffs imposed by the US on steel and aluminum, while Canada's 25 percent auto tariffs took effect Wednesday on US-produced vehicles, according to CNBC.