U.S. equity futures moved firmly higher in early Monday trading, powered by gains for megacap tech stocks, following President Donald Trump’s move to exempt some computers, smartphone and electronics components from the sweeping levies he imposed on China last week.
Stocks rallied hard on Friday, ending a whipsaw week that ultimately powered largest five-day gain for the S&P 500 since November of 2023, after backed down again on his latest tariff gambit by pausing his so-called ‘reciprocal’ levies for at least three months.
He did, however, slap a 145% tariff on China made goods, which Beijing countered with its own trade-killing levy, but exempted key electronics from the final list late Friday.
Adding to the confusion, Trump later said in a social media post that there were no exemptions, despite the Executive Order his signed explicitly stating so, and finally told reporters on Air Force One that semiconductor-specific tariffs would be announced within a week.
That leaves tech companies facing tariffs of 20% on China-made components, as opposed to Friday’s schedule of 145%, with global levies holding at 10% for the next ninety days. Tariffs on goods from Canada and Mexico, meanwhile, remain at 25%.
“We wanted to uncomplicate it from a lot of other companies, because we want to make our chips and semiconductors and other things in our country,” Trump said, adding there would be “some flexibility” for certain companies.
President Donald Trump, having unveiled tariff exemptions on Friday, told reporters on Sunday that there will be no exceptions for the semiconductor sector.
Andrew Harnik/Getty Images
The potential for exemptions powered China-reliant stocks such as Apple (AAPL) , Nvidia (NVDA) and Tesla (TSLA) firmly higher in premarket trading, with tech names pacing the market’s broader Monday advance.
The moves, however, were tempered by more mixed messages from the White House, with Commerce Secretary Howard Luntnick claiming semiconductor-focused tariffs would arrive ‘in a month or two” as opposed to Trump’s signaling of one week.
“Overall, we view the dizzying weekend tariff news as a step forward net positive for Apple as well as other tech names at it gives some flexibility and allows for China negotiations to hopefully take place in the coming months which could deescalate some tariff/trade war issues with Big Tech caught in the middle,” said Wedbush analyst Dan Ives.
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The tariff confusion, as well as the prospect of months of uncertainty tied to business investment and economic growth, pushed the dollar firmly lower again in overnight trading, with the benchmark testing three-year lows against a basket of its global peers.
Benchmark Treasury bond yields, meanwhile, nudged modestly higher, with 10-year notes trading at 4.458% and 2-year notes pegged at 3.921% heading into the start of the New York trading session.
Wall Street seems willing to go with the bullish narrative for the moment, with futures contracts tied to the S&P 500, which is down 4.4% for the month and 8.8% for the year, priced for a 58 point opening bell gain.
The Nasdaq, meanwhile, is called 240 points higher, with Apple rising 5% and Nvidia gaining 2.1%, while the Dow Jones Industrial Average is priced for a 330 point advance.
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In overseas markets, the news of the tariff exemptions lifted Europe’s Stoxx 600 by 2.13% in early Frankfurt trading, with the euro rising to 1.1383 against the U.S. dollar amid its strongest rally in fifteen years.
Overnight in Asia, Japan’s Nikkei 225 rebound from an eight-month low to gain 1.18% in Tokyo, while the regional MSCI ex-Japan benchmark gained 1.59% into the close of trading.
