U.S. futures surged Monday after the U.S. and China announced they were suspending most of the sharp tariff hikes each has imposed since U.S. President Donald Trump began escalating his trade war, the Associated Press reports. Futures for the S&P 500 jumped 3.1%, while futures for the Dow Jones Industrial Average rose 2.5%, and Nasdaq futures soared 3.9%.
American microchip companies, which source much of the material needed for their semiconductors from China, were among the biggest gainers early Monday. ON Semiconductor, Micron and Broadcom all soared between 6% and 8%. Nvidia rose 4.8%.
Travel companies also enjoyed big gains, with American, Delta and United Airlines all up around 7%. Major cruise lines rose similarly.
Retailers, who get much of their inventory from China, also benefited from the announced tariff pause. Amazon was up 7.8%, and Best Buy jumped 10.4% early.
Pharmaceutical companies were among the few losers Monday after Trump said he planned to sign an executive order Monday that, if implemented, could bring down the costs of some medications. The order Trump is promising will direct the Department of Health and Human Services to tie what Medicare pays for medications administered in a doctor’s office to the lowest price paid by other countries. A big pharma trade group criticized the plan, and Johnson & Johnson, Merck and Pfizer all tumbled around 3%.
Oil prices also rallied, with U.S. benchmark crude oil gaining $2.48, more than 4%, to $63.50 per barrel. Brent crude, the international standard, added $2.39 to $66.30 per barrel.
The U.S. dollar surged against the Japanese yen, trading at 148.06 Japanese yen, up from 146.17 yen.
