Media and technology shares followed broader markets higher as the U.S. and China announced a 90-day pause in punishing tariffs that risked economic havoc on both nations.
The two countries issued a joint statement Monday agreeing to slash reciprocal tariffs down to 10%, “recognizing the importance of a sustainable, long-term, and mutually beneficial economic and trade relationship.”
Both sides had started the latest round of talks with mutual 125% tariffs. The U.S. had an additional 20% tax on Chinese imports imposed for the fentanyl trade, which will remain in place. So the U.S. will be keeping a 30% tariff on China vs China’s 10% on U.S. goods.
The pause after weekend talks in Geneva follows a trade deal unveiled late last week between the U.S. and the U.K. that also reassured markets heading into the trading week.
The Dow Jones Industrial Average has surged over 1,000 points Monday. The tech-heavy Nasdaq is up 2.5%. The S&P 500 has gained 2.6% and the Russell 2000 is up 4%.
Roku has jumped by 10%. Amazon is up 7%, Snap 6%, Apple and Meta up by 5% each. Fox gained 5% as well after strong quarterly earnings this morning. Markets have bee volatile to say the least.
Warner Bros. Discovery stock is up 4%. Comcast and Disney gained 3%.
Tech stocks have massive trade supply chains that go through China. Media depends on advertising, which is linked to consumer demand while as tariffs on our biggest trading partners threaten to drive prices higher.
Netflix, which had been riding high and is a Wall Street favorite, is down 2%.
The giant streamer is felt to be public entertainment company most exposed to a tariff on content produced outside the U.S. which President Trump floated a week ago and rose from 100% to 120% in a plan released by his Ambassador to Hollywood, Jon Voight. No decisions have been made but the industry was shocked by the potential hit, as were production hubs outside the U.S.
Amid the tariff tough talk of the past several months, China said it would reduce the number of Hollywood films it accept into the country. A handful have recently been dated however and it’s not sure where that stands either.
