Wall Street wasn’t the only one celebrating on Wednesday. President Trump’s unexpected decision to pause global tariff hikes for 90 days sent stock markets in Europe and Asia reeling – but the drama isn’t over yet.
Investors welcomed the relaxation, but there’s one big exception: China. Trump’s tariff freeze specifically excluded Chinese goods and instead raised tariffs on imports from China by up to 125%. The message? The U.S. can soften its stance globally – but not with Beijing.
The initial market reaction was explosive. Japan’s Nikkei closed up 9.1%, South Korea’s Kospi rose 6.6%, and Taiwan’s stock markets rebounded 9.25% after earlier declines. In Hong Kong, the Hang Seng index rose 2%.
Also Read: Markets Explode Worldwide After Trump’s Surprise Tariff Pause—Is the Trade War Ending?
The announcement came just 12 hours after the initial tariffs were imposed – a rare U-turn in policy from the Trump administration. Trump’s message on social media reflected his optimism: “There are even better days ahead.”
But China is not backing down. After Trump’s latest hike, Beijing retaliated by imposing tariffs on 84% of US imports. Chinese officials made it clear: they didn’t want a trade war, but they were prepared for one.
Speaking from the Oval Office, President Trump downplayed the confrontation. “President Xi is a very smart man,” he said. “I think we’ll get a very good deal.” Still, many are skeptical. China’s foreign ministry has said they will only negotiate if the US shows “equality and mutual respect.”
Meanwhile, European leaders are moving cautiously. The EU will pause its retaliatory tariffs for 90 days but insists countermeasures will resume if negotiations fail. European Central Bank officials are also concerned about market volatility, saying Trump’s move is “less bad news, but still not good news.”
Despite the surge in global markets, underlying uncertainty remains. Investors hope this 90-day pause will lead to progress — but with U.S.-China tensions rising, many wonder if this is just the eye of the storm.
The world’s two largest economies are still on a collision course, so the countdown to a real resolution starts now.
I am a US-based financial analyst and market researcher with over 10 years of experience in analyzing stock trends and economic news. Specializes in forecasting price movements of major US stocks and delivering timely financial updates. I believe in making complex market data simple and actionable for everyday investors.
