Monday saw a strong rebound in the U.S. stock market, with all three major indices surging significantly. The Dow Jones Industrial Average skyrocketed by 1,160.72 points, a gain of 2.81%, closing at 42,410.10. The S&P 500 Index rose by 3.26%, closing at 5,844.19. The Nasdaq Composite Index performed best, closing up 4.35% at 18,708.34.

Thus far, the year-to-date declines for the Dow and the S&P have narrowed to 0.32% and 0.64%, respectively, while the Nasdaq's cumulative decline stands at 3.12%. Market data also shows that, driven by large technology stocks, the Nasdaq 100 Index has rebounded more than 20% from its recent low point, entering a "technical bull market."

Meanwhile, across the ocean, Xinhua News Agency published a commentary article titled "Sino-US Economic and Trade Talks Alleviate Global Economic Pressure and Boost Confidence," stating that rational expectations should be held regarding this round of talks and the direction of Sino-US economic and trade relations for some time to come.

The large tech stocks on Wall Street collectively advanced. Microsoft rose by 2.4%, Apple surged by 6.31%, with reports suggesting Apple is considering raising the price of the upcoming iPhone series. Nvidia climbed by 5.44%, with its market value returning above $3 trillion. Amazon jumped by 8.07%, Google C gained 3.37%, Meta rose by 7.92%, Broadcom increased by 6.43%, and Tesla climbed by 6.75%. Additionally, TSMC ADRs closed up 5.93%, and AMD gained 5.13%. Eli Lilly & Co. rose by 2.86%, and Berkshire Hathaway Class B shares owned by Buffett rose by 0.11%.

The Philadelphia Semiconductor Index closed up 7.04%, with all 30 components rising. The larger-cap TSMC gained 5.93%, ASML rose by 6.23%, AMD increased by 5.13%, Texas Instruments surged by 8.71%, Qualcomm rose by 4.78%, Applied Materials climbed by 7.96%, and Arm Holdings gained 7.78%.

On the other hand, Chinese stocks outperformed the broader market, with the NASDAQ Golden Dragon China Index rising by 5.4%.

Popular Chinese stocks such as Pony.ai initially surged by 11.8%, Fangdd and XPeng gained over 8%, Bilibili rose over 7%, JD.com, Li Auto, and Pinduoduo rose over 6%, Alibaba, NIO, and Baidu rose over 5%, Tencent, New Oriental, and Yum China rose over 4%. In ETFs, the FTSE China 3X Long ETF closed up 9.95%, the China Internet Index ETF closed up 5.56%, the China Technology Index ETF closed up 4.62%, and the "China Dragon" Roundhill China Dragons ETF closed up 3.52%.

Morgan Stanley's latest research report shows that hedge funds, especially those in the U.S., last week increased their bullish bets on Chinese stocks (including buying U.S.-listed Chinese stocks and domestic A-shares).

Market participants generally attribute the rally to positive progress made during weekend trade negotiations, alleviating concerns about the global economy falling into recession.

Several chief analysts from securities firms also unanimously believe that the content of the joint statement between China and the U.S. exceeded market expectations, sending a positive signal to the market.

Joint Statement on High-Level Economic and Trade Talks Between China and the United States

A joint statement was issued on high-level economic and trade talks between China and the United States, with both sides agreeing to significantly reduce bilateral tariff levels.

The joint statement from the Geneva economic and trade talks between China and the U.S. pointed out that both parties committed to taking the following measures by May 14: The U.S. will revise the ad valorem tariffs imposed on Chinese goods (including goods from the Hong Kong Special Administrative Region and Macao Special Administrative Region) on April 2, suspending implementation of 24% of the tariffs for an initial 90-day period while retaining the remaining 10% tariff; canceling tariffs imposed on these goods on April 8 and April 9.

China will correspondingly modify the ad valorem tariffs imposed on U.S. goods specified in Announcement No. 4 of 2025 of the Tariff Commission, suspending implementation of 24% of the tariffs for an initial 90-day period while retaining the remaining 10% tariff, and canceling tariffs imposed according to Announcement Nos. 5 and 6 of 2025 of the Tariff Commission; take necessary measures to suspend or cancel non-tariff countermeasures implemented against the U.S. since April 2.

Both parties agreed to establish a Sino-U.S. economic and trade consultation mechanism to maintain close communication on each other's concerns in the economic and trade field, and conduct further consultations. The Chinese representative is Vice Premier He Lifeng, and the U.S. representatives are Treasury Secretary Besten and Trade Representative Grille. Both sides will hold consultations in rotation in China and the U.S., or in a third country as agreed upon. As needed, both sides may conduct working-level consultations on relevant economic and trade issues.

In general, the U.S. canceled a total of 91% of the additional tariffs, while China correspondingly canceled 91% of the countermeasures; the U.S. suspended the implementation of 24% of the "reciprocal tariffs," and China also correspondingly suspended the implementation of 24% of the countermeasures.

At the same time, Xinhua News Agency published a commentary article titled "Sino-US Economic and Trade Talks Alleviate Global Economic Pressure and Boost Confidence," stating that rational expectations should be held regarding this round of talks and the direction of Sino-US economic and trade relations for some time to come. Sitting down to talk is a necessary posture to avoid the escalation of conflicts. However, expecting to completely eliminate all differences through one or two rounds of talks is clearly unrealistic. We not only welcome the resumption of dialogue but also fully prepare ourselves mentally for the long-term, complex, and arduous nature of eliminating differences between China and the U.S.

Trump Demands Drug Manufacturers Lower Prices of U.S. Pharmaceuticals

U.S. President Trump signed an executive order requiring drug manufacturers to lower prices of U.S. pharmaceuticals to align with those of other countries.

Trump stated that if prices in the U.S. do not match those of other countries, the government will impose tariffs on companies, and he is seeking a reduction of 59% to 90%. The order also instructed the government to consider promoting direct-to-consumer procurement plans to sell drugs at foreign prices. However, analysts and legal experts believe this executive order will be difficult to implement.

The order sets price targets for drug manufacturers within 30 days, and if these companies do not make significant progress toward achieving these goals within six months after the signing of the order, further actions will be taken to lower prices.

At a press conference, Trump said that if prices in the U.S. do not match those of other countries, the government will impose tariffs on companies and he is seeking a reduction of 59% to 90%.

"Everyone should be equal. Everyone should pay the same price," Trump said.

Investors expressed skepticism about the enforcement of the order, and stock prices that had fallen overnight due to the threat of "most-favored-nation pricing" rebounded and rose during early trading on Monday.

China Launches Special Operation to Crack Down on Strategic Mineral Smuggling Exports

A commerce spokesperson stated on the 12th that strengthening the export control of strategic mineral resources is crucial to national security and development interests. Since the implementation of export controls on certain strategic minerals, we have discovered that some overseas entities collude with illegal personnel in China to attempt to evade export control measures through smuggling and other means. To curb such trends, the National Export Control Coordination Mechanism Office convened a meeting in Shenzhen, Guangdong Province, on May 9, focusing on cracking down on strategic mineral smuggling and making special arrangements. Further actions will be organized soon.

The spokesperson said that relevant departments immediately launched operations, swiftly conducting cross-departmental investigations and case consultations regarding recent attempts to evade export controls through misrepresentation, concealment, hidden smuggling, and transshipment via a "third country." Efforts were intensified to inspect ports and crack down on violations, thoroughly investigating the illegal entities and smuggling networks behind the scenes, handling illegal cases quickly and strictly, continuously enhancing the effectiveness of export control law enforcement, and effectively safeguarding national security and development interests.

Relevant information shows that the medium and heavy rare earths subject to export controls previously include these. The work deployment meeting on strengthening full-chain control of strategic mineral exports held on May 12 emphasized that controlling the export of strategic minerals is crucial to national security and development interests, and strengthening full-chain control is key. All departments and regions must closely monitor the flow of strategic minerals to prevent them from illegally flowing out of the country.

This article is an exclusive contribution from Observer Network and cannot be reprinted without permission.

Original source: https://www.toutiao.com/article/7503728872161018419/

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