Real Vision: Finance & Investing
US-China Tariff Cut and Global Market Surge: PALvatar Market Recap, May 12 2025
May 12, 2025
Huge market enthusiasm follows a significant U.S.-China tariff cut, triggering boosts in equities, oil, and the dollar. The tech sector shines on Wall Street with impressive gains. Positive news extends with a ceasefire between India and Pakistan fueling optimism. Additionally, Japan reports a current account surplus, while loan growth faces a slowdown. Keep an eye on upcoming U.S. inflation data, which could further shape market trends.
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Quick takeaways
- The significant tariff reduction between the US and China has led to a notable surge in global markets, particularly equities and oil prices.
- Economic indicators from Japan highlight a mixed landscape, with a current account surplus but a concerning slowdown in loan growth affecting recovery outlooks.
Deep dives
Market Boost from US-China Tariff Agreement
Global markets have experienced a significant surge following a new agreement between the US and China to reduce mutual tariffs for a 90-day period. US Treasury Secretary Scott Besant announced that both countries will lower their respective tariffs by 115 percentage points, bringing the US tariffs on China down to 30% and Chinese tariffs to 10%. This unexpected de-escalation of the trade conflict has positively impacted various equities, oil prices, and the US dollar, leading to a boost in stock markets across Asia and Europe. Notably, the Hang Seng Index jumped by 3% while the Shenzhen Composite rose nearly 2%, reflecting investor optimism in response to the news.
