By Chuck Mikolajczak
NEW YORK (Reuters) -Global stocks rallied on Monday, led by gains in U.S. stocks, while U.S. Treasury yields climbed after reports that President Donald Trump’s tariff plan may use a more targeted approach than previously thought, boosting risk appetite.
Trump said automobile tariffs are coming soon, and said he may give “loads of countries” breaks on tariffs, but provided no details.
“Investors are experiencing a slight sigh of relief, but at the identical time they’re cynical about how long this may increasingly last,” said Sam Stovall, chief investment strategist at CFRA Research.
“The causes of this manufactured correction haven’t evaporated. They’re tariffs and what the impact of tariffs might be on economic growth, inflation and company profits.”
Equities have been under pressure in recent weeks, weighed down by uncertainty over the potential levies and the damage they may inflict on the worldwide economy in addition to corporate profits.
A string of economic indicators has also pointed to cooling consumer sentiment as tariff concerns grew.
Data on Monday showed S&P Global’s flash U.S. Composite PMI Output Index, which tracks the manufacturing and services sectors, increased to 53.5 this month from 51.6 in February. A reading above 50 indicates expansion.
Nonetheless, concerns about tariffs and the sharp cuts in government spending continued to dent sentiment, because the survey’s business confidence measure dropped to the second lowest reading since 2022.
The Dow Jones Industrial Average rose 597.97 points, or 1.42%, to 42,583.32, the S&P 500 rose 100.01 points, or 1.76%, to five,767.57 and the Nasdaq Composite rose 404.54 points, or 2.27%, to 18,188.59. Nasdaq touched its highest level since March 7.
MSCI’s gauge of stocks across the globe gained 9.84 points, or 1.17%, to 851.83 after hitting a two-week high of 852.39.
The MSCI index had fallen nearly 8% from its mid-February record through its March 13 closing low, before snapping a four-week string of declines last week.
Tariff uncertainty still weighed on other global stock indexes, nevertheless, and the pan-European STOXX 600 index closed down 0.13%.
European shares had risen earlier within the session after HCOB’s preliminary composite euro zone Purchasing Managers’ Index, compiled by S&P Global, rose to 50.4 this month from February’s 50.2, its highest since August.
Trump still plans to impose recent reciprocal tariffs next week, but questions remain in regards to the size of the duties and which countries can be targeted.
As well as, Trump said on Monday that any country that buys oil or gas from Venezuela pays a 25% tariff on exports to the USA.