US stocks surge, dollar gains in dramatic relief rally as Trump pauses tariffs

Stock indexes posted their biggest one-day gains in years, with the S&P 500 recording its largest rise since 2008, while the dollar gained and Treasuries pared losses on Wednesday after U.S. President Donald Trump declared a temporary U.S. pause on tariffs.

The announcement by Trump came in the afternoon after days of market turmoil, with bond prices and the U.S. dollar selling off earlier in the day on fears that the administration's plans to raise tariffs to levels last seen more than 100 years ago would push the economy into recession.

The president announced an immediate 90-day tariff pause for many countries even as he raised the levy on Chinese imports to 125%.

The news of a pause brought sudden relief to the market. The S&P 500 ended 9.5% higher, while the Nasdaq rose 12.2% in its biggest one-day gain since January 3, 2001, and its second-biggest on record. But investors said uncertainty about the longer-term plan for tariffs persisted.

"This is the pivotal moment we've been waiting for," said Gina Bolvin, president of Bolvin Wealth Management Group in Boston. "The timing couldn’t be better, coinciding with the start of earnings season."

"However, uncertainty looms over what happens after the 90-day period, leaving investors to grapple with potential volatility ahead," Bolvin added.

The Dow Jones Industrial Average rose 2,962.86 points, or 7.87%, to 40,608.45, the S&P 500 rose 474.13 points, or 9.52%, to 5,456.90 and the Nasdaq Composite rose 1,857.06 points, or 12.16%, to 17,124.97.

MSCI's gauge of stocks across the globe rose 42.32 points, or 5.70%, to 785.28. Earlier in the day, the pan-European STOXX 600 index ended down 3.5%.