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Most tech stocks are surging today after a shocking announcement from China took the market by storm this morning.
Even after several strong earnings reports over the past two weeks, many prominent companies have struggled as tariffs levied by President Donald Trump sparked retaliation from trade partners, causing high economic uncertainty.
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This has likely spooked investors, as experts have floated terms like “recession” and “bear market.”
However, today’s news has caused a shift in momentum, pushing many leading tech stocks up, ranging from consumer tech producers to their peers in the artificial intelligence (AI) space. That includes market leader Nvidia (NVDA) , which has been rising since markets opened.
China news is helping push up Nvidia and its peers
This week is off to a great start for many sectors, but especially for tech. In a joint statement released this morning, the U.S. and Chinese governments announced a 90-day pause on the tariffs they have levied against each other, adding that negotiations over that period will continue.
Related: Nvidia shareholders shouldn't worry about China news, says analyst
For both investors and consumers, this is an extremely positive development. It means that both nations will significantly lower the tariffs they have imposed on each other, with the U.S. decreasing its tariff against China from 145% to 30% and China lowering its retaliatory tariffs from 125% to 10%, substantially decreasing the costs imposed on many companies.
Companies like Nvidia won’t be impacted by this news as much as their peers in the consumer tech space, such as Apple and Samsung. This tariff pause doesn’t eliminate barriers regarding countries and entities to which U.S. firms can sell AI chips, a major challenge Nvidia is facing.
However, NVDA stock has reacted positively to the announcement, sending shares into the green.
“Nvidia stock jumped 4.3% in morning moves,” reports Investor’s Business Daily. “Shares of the artificial intelligence giant have moved decisively above their 50-day line over the last few trading sessions and are approaching their 200-day line, a key area to watch.”
More Nvidia News:
Since then, shares have kept rising and are currently up more than 5%. While Nvidia doesn’t have much to gain directly from the tariff pause, the news could end up being a bullish indicator. Today’s gains are likely the result of positive market momentum, however.