US stocks jumped Monday morning after President Trump signaled a trade deal with China is likely to come this week, including an end to export restrictions on critical minerals.
The Dow Jones Industrial Average soared 302 points, or 0.6%, by approximately 9:30 a.m. ET, while the S&P 500 and Nasdaq rose 0.9% and 1.4%, respectively.
“I have a lot of respect for President Xi, and we are going to come away with the deal,” Trump assured reporters aboard Air Force One on Monday.
Over the weekend, Treasury Secretary Scott Bessent said the deal would likely erase Trump’s threatened 100% tariff on China and delay Beijing’s strict export controls on rare earths, which are key to energy infrastructure, defense technologies and manufacturing.
Trump is slated to meet with Chinese leader Xi Jinping for highly-anticipated trade talks on Thursday.
Shares in tech giants and chipmakers soared on Monday, since these firms’ supply chains are heavily reliant on China.
Shares in Jensen Huang’s Nvidia jumped 2.2%, while Broadcom and AMD gained 2.2% and 0.8%. Elon Musk’s Tesla rose 2.4% while Apple ticked up 1.2%.
Investors are hopeful the deal will also push China to resume its purchasing of US soybeans, as American farmers have lost out on market share to countries like Brazil and Argentina amid Trump’s tariffs.
Trump is also eyeing a TikTok deal that would transfer ownership of the US version of the video-sharing app to American hands.
Further adding to the stock rally, the Federal Reserve is largely expected to slash rates this Wednesday, especially after consumer inflation came in tamer than expected last week.
It was a rare round of economic data amid the government shutdown, which entered its twenty-seventh day on Monday with no end in sight.
However, heightened trade tensions with Canada kept investor optimism in check.
Trump on Saturday slapped the nation with an additional 10% tariff over a TV ad that featured audio of Ronald Reagan circa 1987 heavily criticizing the use of tariffs.
Meanwhile, shares of US-listed rare earth miners plunged Monday as investors prepared for a potential rebound in Chinese supply, reducing their need for American miners.
Shares in Critical Minerals, USA Rare Earth, MP Materials and Trilogy Metals dropped 18.7%, 13.9%, 6.5% and 14.5%, respectively.
Energy Fuels and NioCorp Developments fell 10.9% and 14.2%, respectively.
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