US stocks recovered some ground on Monday after President Donald Trump softened his stance toward China, following last week’s threat of higher tariffs starting next month.
The initial warning, triggered by China’s new restrictions on rare earth exports—key components in high-tech manufacturing—had reignited fears of an escalated U.S.-China trade war. That turmoil wiped roughly USD2 trillion from U.S. stock values in a broad market sell-off.
On Sunday, Trump attempted to ease concerns, suggesting relations with China would improve and emphasizing a shared interest in economic stability. While his comments struck a more conciliatory tone, they also maintained pressure on Beijing to roll back trade curbs.
Meanwhile, fresh data showed China’s exports in September outpaced expectations, as the country deepened trade ties with non-U.S. partners.
Elsewhere, optimism around artificial intelligence lifted sentiment. OpenAI announced a partnership with Broadcom (AVGO), adding momentum to a string of recent AI-related deals. Broadcom shares jumped nearly 10 percent, while Taiwan Semiconductor Manufacturing Co. surged almost 8 percent after analysts projected a 28 percent jump in its third-quarter profits.
All three major U.S. indexes closed higher. The Dow Jones Industrial Average rose 1.3 percent, the S&P 500 gained 1.6 percent, and the Nasdaq advanced 2.2 percent.
