The Dow Jones Industrial Average surged nearly 600 points on Monday as investors grew optimistic that President Donald Trump may soften his stance on tariffs. The rally was driven by hopes that the U.S. could avoid an economic slowdown resulting from a prolonged trade war. The Dow rose by 597.97 points, or 1.42%, to end at 42,583.32.
The S&P 500 gained 1.76% to close at 5,767.57, while the tech-heavy Nasdaq Composite surged 2.27%, settling at 18,188.59. Consumer discretionary stocks, among the worst-performing sectors this year, led the S&P 500 with their best performance since November 2023. The sector rose 3.7% on Monday, largely driven by a surge in electric vehicle stocks, which climbed more than 10%.
Reports indicated that the upcoming tariffs might be narrower in scope and that sector-specific tariffs could be delayed. President Trump said late Monday afternoon that he might give “a lot of countries” breaks on reciprocal tariffs.
Dow climbs on tariff concession hopes
He also mentioned that levies on sectors such as pharmaceuticals and autos would still be forthcoming in the “near future,” confirming they would not be part of the early April rollout. Charlie Ripley, senior investment strategist at Allianz Investment Management, noted the potential reduction in risks of a full-blown trade war. “We see this as a potential lift to growth in the U.S., should tariffs come in a more watered-down form,” Ripley said.
Investor confidence had been shaken in recent weeks by growing recession concerns. Stocks had fallen sharply since late February, with the S&P 500 entering correction territory at one point. However, Trump’s comments on Friday about potential flexibility with his tariff plan helped push major averages into the green for the session and allowed the S&P 500 to avoid a fifth consecutive losing week.
In other news, shares of Oklo rose more than 13% after the company announced that the Nuclear Regulatory Commission would soon begin an assessment to determine whether its license application is ready for a full review. Pinterest shares increased by 4.5% following an upgrade from Guggenheim, and Palantir Technologies stock climbed more than 5% on Monday, marking another session of significant gains. The Treasury Department granted Chevron an extension to continue its oil operations in Venezuela until May 27, aligning with President Trump’s decision to reverse a previous administration policy that had halted American oil production in the country.
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