The global market meltdown turned into euphoria on Thursday morning after Donald Trump’s about-turn on tariffs imposed on the rest of the world, with the exception of China.
After triggering a global trade war and shaking the markets, Trump announced a 90-day suspension of import taxes against dozens of countries and partners, notably against the European Union, which in principle came into force at 4.01 GMT on Wednesday.
In Europe, the main indexes soared as soon as they opened. At around 7.30 GMT, the Paris Stock Exchange was up 6.35 per cent, Frankfurt 6.57 per cent, London 4.66 per cent and Milan 6.83 per cent. The Swiss Stock Exchange was up 5.69 per cent, with the Bel20 in Belgium up 6 per cent at 10.00 GMT.
In Tokyo, the Nikkei index ended the day with a jump of more than 9 per cent, and in Seoul, the Kospi index gained 6.6 per cent. The Dow Jones soared 7.87 per cent and the Nasdaq more than 12 per cent, in their best session since 2008.
European Commission president Ursula von der Leyen welcomed the decision, calling it “an important step towards stabilising the global economy.”
Caution required
Trump’s tone remains the same with regard to China. He announced on Wednesday that he would increase the tariffs on Beijing due to a supposed “lack of respect”, raising them from 104 per cent to 125 per cent.
Chinese markets are holding steady, however. In the last trading session in Hong Kong, the Hang Seng index gained 2.46 per cent. The Shanghai composite index gained 1.16 per cent, and the Shenzhen index 2.25 per cent.
“Caution is still called for,” said Jochen Stanzl of financial services company CMC Market, noting that the universal 10 per cent customs duties are still in force.
