Wall Street Welcomes Trump's EU Tariff Delay

Wall Street rallied on Tuesday after President Trump delayed a 50% tariff on goods coming from the European Union.

• The S&P 500 rose 118.72 points, or 2%, to 5,921.54.
• The Dow Jones Industrial Average rose 740.58 points, or 1.8%, to 42,343.65.
• The Nasdaq composite rose 461.96 points, or 2.5%, to 19,199.16.

Stocks more than recovered their losses from Friday, when Wall Street's roller coaster dropped after Trump announced the tariffs on the European Union. Trump said Sunday that the United States will delay a 50% tariff on goods coming from the European Union from June 1 until July 9. The European Union's chief trade negotiator said Monday, when US markets were closed, that he had "good calls" with Trump officials and the EU was "fully committed" to reaching a deal.

Such talks give hope that the United States can reach a deal with one of its largest trading partners that would keep global commerce moving and avoid a possible recession, the AP reports. Trump declared a similar pause on his stiff tariffs on products coming from China earlier this month, which launched an even bigger rally on Wall Street at the time. "We focus on actions over words," Jean Boivin and other strategists at BlackRock Investment Institute said, "as economic constraints spur policy rollbacks." A worry, however, is that all the uncertainty caused by on-again-off-again tariffs could damage the economy by pushing US households and businesses to freeze their spending and investments.

On Tuesday, though, optimism ruled. The stock market's gains accelerated after a report released by the Conference Board said confidence among US consumers improved by more in May than economists expected. It was the first increase in six months, and consumers' expectations for income, business and the job market in the short term jumped sharply, though it still remains below the level that typically signals a recession ahead.

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On Wall Street, Nvidia rallied 3.2% and was the strongest single force driving the S&P 500 higher ahead of its profit report coming on Wednesday. Informatica climbed 6% after Salesforce said it would buy the AI-powered cloud data management company in an all-stock deal valuing it at about $8 billion. Salesforce rose 1.5%. They were part of widespread gains across the US stock market. One of the outliers was AutoZone, which fell 3.8% following a mixed report on its performance for the three months through May 10. Its profit fell short of analysts' expectations, though its growth in revenue was stronger than expected. (More stock market stories.)