Shares of major machinery companies, including AGCO Corporation ( AGCO ) , Caterpillar Inc. ( CAT ) and Cummins Inc ( CMI ). are trading higher Monday afternoon after the United States and China reached a temporary agreement to slash tariffs on each other's goods.

What To Know: The rally reflects broad optimism that reduced trade barriers xould ease supply chain constraints and boost business confidence in the industrial and manufacturing sectors.

The tariff rollback, announced after talks in Geneva between U.S. Treasury Secretary Scott Bessent and China's Vice Premier He Lifeng, cuts U.S. tariffs on Chinese goods from 145% to 30% and reduces Chinese tariffs on American goods from 125% to 10%. The reductions take effect on May 14 and are scheduled to last for 90 days as both countries assess next steps in their trade relationship.

Companies in the machinery and industrial equipment space are among the most directly impacted by such tariffs, given their reliance on international supply chains and global demand for capital goods.

Wall Street responded positively, with major equity futures rising across the board. S&P 500 futures jumped 3.1%, Nasdaq futures surged over 4% and Dow futures gained more than 2.6%. The dollar strengthened while gold prices declined, reflecting a shift away from safe-haven assets.

Price Action: AGCO ( AGCO ) shares are up 6.55% to $105.85, Caterpillar ( CAT ) shares gained 5.4% to $343.21 and Cummins shares jumped 7.6% to $330.01, according to Benzinga Pro.

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