BY LIZ LEE, ANDREA SHALAL AND SUSAN HEAVEY
BEIJING/WASHINGTON- US President Donald Trump’s stunning decision to pause the hefty duties he had just imposed on dozens of countries sent battered global stock markets surging on Thursday even as he ratcheted up a trade war with the world’s No. 2 economy China.
Trump’s turnabout on Wednesday, which came less than 24 hours after steep new tariffs kicked in on most trading partners, followed the most intense episode of financial market volatility since the early days of the COVID-19 pandemic.
The upheaval erased trillions of dollars from stock markets and led to an unsettling surge in US government bond yields that appeared to catch Trump’s attention.
“I thought that people were jumping a little bit out of line, they were getting yippy, you know,” Trump told reporters after the announcement, referring to jitters sportpeople sometimes get.
US stock indexes shot higher on the news, with the benchmark S&P index closing 9.5 percent higher, and the relief continued into Asian trading on Thursday with Japan’s Nikkei surging 8 percent.
European futures also pointed to big gains, but there were already signs the rally may be short-lived with US stock futures trading lower.
Hopes of state support helped prop up Chinese stocks, although its yuan currency fell to its weakest level since the global financial crisis.
Since returning to the White House in January, Trump has repeatedly threatened an array of punitive measures on trading partners, only to revoke some of them at the last minute. The on-again, off-again approach has baffled world leaders and spooked business executives.
US Treasury Secretary Scott Bessent asserted that the pullback had been the plan all along to bring countries to the bargaining table. Trump, though, later indicated that the near-panic in markets that had unfolded since his April 2 announcements had factored in to his thinking.
Despite insisting for days that his policies would never change, he told reporters on Wednesday: “You have to be flexible.”
