US stock markets rose on Monday after the White House said tariffs on imports of Chinese-made smartphones and some other electronics devices would not apply.
The rollback, issued early on Saturday, may end up being short-lived after President Donald Trump said these goods were simply being moved into a different tariff group or “bucket”.
In Europe, the UK’s FTSE 100 closed up 2.1% while the main stock indexes in France and Germany both climbed.
Despite the partial rebound, global stock markets are still lower than before Trump’s “Liberation Day” tariffs announcement on 2 April.
The main US and European stock markets suffered historic falls followed by record rises after Trump suspended many tariffs for 90 days.
Most imports from China to the US had faced a levy of 145% under Trump’s new trade regime. Beijing responded with its own 125% tariffs on American products coming into China.
The Trump administration is expected to announce tariffs on semiconductors on Monday, and smartphones, computers and other electronic devices exempted will fall into this category.
The technology-heavy Nasdaq index was up 1.7% on Monday. The S&P 500 nudged up 0.5% while the Dow Jones Industrial Average gained 0.3%.
Apple – which makes most of its iPhones intended for sale in the US in China – saw its share price jump 5% in early trading on Monday’s before settling to 2.3% higher. Chip maker ASML and tech firm Dell also rose.
“Investors were so relieved to have some good tariff news to latch onto for a change that they weren’t overly concerned with the potential complications which may be coming down the line,” said Danni Hewson, AJ Bell’s head of financial analysis.
However, Monday’s gains have not reversed the losses since tariffs were first announced.
The S&P 500 index is 4.3% down over the last month while the FTSE 100 is 5.8% down, the German Dax is 8.8% down, and the French Cac 40 is 9.4% down.
“It looks like the tech exemption provided some relief, but these rebounds can be temporary,” Sree Kochugovindan, a senior economist at aberdeen group, told the BBC.
“There is still risk of more volatility given the lack of clarity during this 90-day tariff pause,” she said.
Meanwhile, the value of the US dollar continued to fall on Monday – down 0.7% against the British pound, having dropped 2.7% against the pound since Thursday.
The bond market appeared stable on Monday, with a key interest rate on US government debt down to 4.4%, but still higher than before 2 April.
The rate spiked last Wednesday as investors worried about a possible recession, and sold US government bonds, which are usually seen as a safe investment.
