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Trump sets 90-day tariff pause but raises China levy to

125%

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Nasdaq's second-biggest daily gain, S&P's biggest since

2008

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All S&P 500 sectors rally, with tech adding 14.15%

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Indexes rally: Dow 7.87%, S&P 500 9.52%, Nasdaq 12.16%

(Updates with final prices, adds volume data)

By Sinéad Carew and Shashwat Chauhan

April 9 (Reuters) - The S&P 500 soared 9.5% on Wednesday

for its biggest daily gain since 2008 after U.S. President

Donald Trump declared an immediate 90-day tariff pause for many

countries, bringing some relief to investors worried about the

global economic impact of U.S. trade policies.

The rally, which followed Wall Street's biggest four-day

percentage loss since the pandemic, was triggered by an

afternoon announcement that Trump would temporarily lower many

new tariffs, while he raised the levy on Chinese imports to

125%.

The pause of heftier tariffs on dozens of countries came

less than 24 hours after they kicked in. However, the White

House kept a 10% blanket duty on almost all U.S. imports.

The increase in China tariffs was in retaliation for China's

announcement of an 84% levy on U.S. goods starting April 10.

Traders took the opportunity to shop for beaten-down stocks.

Since Trump announced broad tariffs late on April 2, stocks had

fallen more than 12%.

"This is the pivotal moment we've been waiting for. The

immediate market reaction has been overwhelmingly positive, as

investors interpret this as a step toward much-needed clarity,"

said Gina Bolvin, president of Bolvin Wealth Management Group.

"However, uncertainty looms over what happens after the

90-day period, leaving investors to grapple with potential

volatility ahead."

After Trump's pause announcement, Goldman Sachs said it was

rescinding its recession forecast and reverting to its previous

baseline estimate for the economy to grow in 2025.

Kevin Gordon, senior investment strategist at Charles

Schwab, said the rally from oversold levels made sense but

cautioned that "to have a high conviction call on anything right

now is a fool's errand."

"We just have to wait and see what the ultimate policy is,

but unfortunately the policy changes almost on a daily basis,"

said Gordon, adding he was concerned about companies' ability to

make spending and hiring decisions in such an environment.

Even with the rally, all three of Wall Street's major

averages ended the session below the April 2 close, the last

trading day before Trump unveiled broad tariffs.

The Dow Jones Industrial Average rose 2,962.86

points, or 7.87%, to 40,608.45.

The S&P 500 gained 474.13 points, or 9.52%, to

5,456.90 for its biggest daily gain since October 2008, during

the global financial crisis.

The Nasdaq Composite added 1,857.06 points, or

12.16%, to 17,124.97, for its biggest gain since January 2001,

during the dotcom market bubble.

The smallcap Russell 2000 Index added 8.66%, for its

biggest one-day jump since March 2020.

All 11 of the S&P 500's major industry indexes finished

higher, with technology adding 14.15%. Defensive

utilities were the slowest gainer, adding 3.91%.

Large technology stocks provided the biggest boost, with

Nvidia ( NVDA ) adding 18.7% and Apple ( AAPL ) rising 15.3%.

The S&P 500 Auto Index ended up 20.95%, by far

its biggest daily gain on record.

Also helping to calm investor sentiment was the U.S.

Treasury's $39-billion 10-year note auction. The

auction came within market expectations, priced at a high yield

of 4.435%, lower than the rate forecast at the bid deadline,

suggesting solid investor demand.

"Longer-term questions will almost certainly remain. But

this afternoon's announcement, combined with the Treasury

auction, is a welcome relief after several days of very high

volatility," said Jeffrey Palma, head of multi-asset solutions

and macro research at Cohen & Steers in New York.

The CBOE Volatility Index - seen as Wall Street's

"fear gauge" - fell sharply after the tariff pause to end the

day at 33.62 points, compared with its session high of 57.96.

Minutes from the Federal Reserve's meeting last month were

also released in the afternoon.

Fed policymakers were nearly unanimous that the U.S. economy

faced risks of simultaneously higher inflation and slower

growth, with some policymakers noting that "difficult tradeoffs"

could lie ahead for the central bank.

A consumer price inflation report scheduled for Thursday

morning will be closely watched by investors for clues on the

inflation trajectory.

The upcoming earnings season will offer more insights into

the health of corporate America as investors fear a hit to

economic growth from the tariffs. U.S. banks, including JPMorgan

Chase ( JPM ), will report first-quarter results on Friday.

Delta Air Lines ( DAL ) shares soared 23.4% after the

carrier beat first-quarter profit expectations. The company,

though, pulled its 2025 financial forecast and projected

current-quarter profit below expectations.

Advancing issues outnumbered decliners by a 6.4-to-1 ratio

on the NYSE where there were 30 new highs and 1,187 new lows.

On the Nasdaq, 3,841 stocks rose and 684 fell as advancing

issues outnumbered decliners by a 5.62-to-1 ratio. The S&P 500

posted one new 52-week high and 100 new lows while the Nasdaq

Composite recorded 12 new highs and 646 new lows.

Wednesday was a record day for trading volume with 30.5

billion shares changing hands on U.S. exchanges, compared with

the 18.06 billion average for the last 20 sessions.