US stocks soared on Monday, closing near session highs, as optimism grew that the next round of tariffs from President Trump would be less severe than previously feared. Reports suggesting a narrower scope for the upcoming trade measures provided a significant boost to investor sentiment, driving strong gains across major indices.

The S&P 500 surged nearly 1.8%, continuing its upward momentum after snapping a four-week losing streak. The Dow Jones Industrial Average climbed 1.4%, while the tech-heavy Nasdaq Composite led the charge with a 2.3% gain. The rally came as investors reacted positively to news that the US may offer exemptions or reductions in planned reciprocal tariffs, easing concerns of escalating trade tensions.

Trump Hints at Tariff Relief

Speaking on Monday, President Trump suggested that multiple countries might receive exemptions from the tariffs set to take effect on April 2. "We may take less than what they're charging because they've charged us so much, I don't think they could take it," Trump stated, hinting at a softer stance compared to previous expectations.

Reports from Bloomberg and The Wall Street Journal indicated that the tariffs, initially anticipated to be sweeping, could instead be targeted more narrowly. This development helped alleviate fears that prolonged trade disputes would exacerbate inflation and slow economic growth.

Bond Yields Rise Amid Renewed Risk Appetite

As concerns over aggressive trade measures receded, risk appetite strengthened, pushing the yield on the 10-year Treasury up by seven basis points to 4.33%. The shift suggests that investors are becoming more confident in economic stability despite earlier worries about trade-related disruptions.

Tesla and Tech Stocks Lead the Gains

Tesla was among the biggest winners of the day, with its stock rallying nearly 12%. The surge came as investors speculated that the US government might hold off on imposing tariffs on the auto sector, a move that had been widely anticipated for April 2.

The broader tech sector also benefited from positive news in the semiconductor space. Jack Ma’s Ant Group announced expectations for a significant reduction in AI-related costs by utilizing alternative chips to those made by Nvidia. This development further fueled gains in technology stocks, reinforcing the sector’s leadership in Monday’s market rally.

While uncertainty around trade policy remains, Monday’s market reaction signals renewed investor confidence. If the tariff measures indeed turn out to be more lenient than initially expected, it could provide further relief to the markets and support continued growth. However, traders will remain cautious as they await concrete details on the administration’s trade policy in the coming weeks.

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