Stocks surged early Monday following news that the U.S. and China had agreed to a 90-day pause in their ongoing trade conflict. As part of the deal, both nations will roll back most of the tariffs that economists had warned might trigger a recession and lead to product shortages in American stores.

The 90-day pause is a major de-escalation in the tariff war and comes after talks between both countries in Geneva.

The S&P 500 climbed by 2.8% on Monday, May 12, 2025 as investors reviewed the trade deal between the U.S. and China that significantly reduces tariffs for 90 days as negotiations continue.