New York
CNN
—
US stocks rose Wednesday following two days of steep declines. The rally came after the Trump administration announced a one-month reprieve on auto tariffs for Canada and Mexico, easing investor concerns about a global trade war.
US stocks, which had teetered during the day, surged higher after the White House confirmed the one-month exemption. The Dow jumped 615 points before pulling back slightly to close higher by 486 points, or 1.14%, at 43,007. The broader S&P 500 rose 1.12% and the Nasdaq Composite gained 1.46%.
“We spoke with the Big Three auto dealers. We are going to give a one-month exemption on any autos coming through USMCA,” President Donald Trump said in a statement read by White House Press Secretary Karoline Leavitt at a press briefing Wednesday. Those dealers included Stellantis, Ford and General Motors.
Shares in General Motors (GM) rose 7.21%. Shares in Stellantis (STLA) rose 9.24% and shares in Ford (F) gained 5.81%.
The announcement of a one-month reprieve for tariffs on automakers is welcome news for investors who are looking for signs that the Trump administration might further negotiate or roll back its tariff policies.
The afternoon rally is a rebound in the stock market after it took a beating to start the week. The Dow tumbled a whopping 1,300 points across Monday and Tuesday, largely driven by Trump’s enactment of tariffs — and the subsequent retaliation from trading partners. The broader S&P 500 on Tuesday erased its gains since Trump’s reelection in November.
In his address to Congress on Tuesday, Trump did not mention the stock market — a barometer of the economy that he usually touts as evidence of his success as president. Yet Trump said tariffs might cause a “little disturbance” in the economy.
Experts point to increased uncertainty for investors.
“With Canada, Mexico and China now retaliating, trade tensions have escalated, increasing inflation risks and market volatility,” said Solita Marcelli, chief investment officer for the Americas at UBS Global Wealth Management, in a note Wednesday.
The rebound in markets on Wednesday recoups some of the week’s earlier losses, but the S&P 500 is still off of its previous record high, reached just two weeks ago.
Crude oil prices tumbled on Wednesday due to concerns about a brewing trade war and OPEC+ oversupplying the market. Futures on WTI crude, the US benchmark, fell 2.7% to $66.40, the lowest price since September 2024.
At one point during the day, crude dropped to $65.22, the lowest intraday price since March 2023.
Kevin Gordon, a senior investment strategist at Charles Schwab, said the back and forth with tariffs has created a fog of uncertainty for investors, businesses and consumers.
“Uncertainty is the policy at this point,” Gordon said.
