Global financial markets surged on Tuesday following remarks by U.S. President Donald Trump that suggested a more conciliatory tone toward China and Federal Reserve Chair Jerome Powell, easing investor fears over escalating economic tensions.
During a press conference at the White House, Trump acknowledged “constructive discussions” with Chinese officials on trade and tariffs, signaling a potential shift from his previous hardline stance. “We’re making progress,” Trump said. “There’s no need for unnecessary escalation if both sides are willing to work together.”
Markets responded immediately. The Dow Jones Industrial Average closed up nearly 400 points, while the S&P 500 and Nasdaq both climbed more than 1.5%, reflecting renewed optimism among investors. European markets also saw gains, with the FTSE 100 and DAX both rising significantly.
The rally was further fueled by Trump’s softened tone on Jerome Powell, whom he has previously criticized over interest rate policy. “I’ve had differences with the Fed chair, but I believe we’re starting to see eye-to-eye,” Trump stated, adding that stable monetary policy would be critical heading into the second half of the year.
Analysts noted that Trump’s remarks were likely aimed at calming financial volatility amid a backdrop of growing global uncertainty, including recent concerns over tariffs on Chinese goods and ongoing debate about Federal Reserve independence.
“This is the first time in weeks we’ve seen markets breathe a sigh of relief,” said a New York-based economist. “A softer Trump means a more stable trading environment—for now.”
However, investors remain cautious, as previous optimistic signals have been reversed by subsequent policy moves. Many are watching closely to see if the administration follows rhetoric with concrete action.
