ADVERTISEMENTThe euro extended gains against the US dollar, while European stock markets are poised to open higher after the White House exempted electronics from its reciprocal tariffs. However, US President Donald Trump and his administration suggested the exemption may be short-lived, stating that tariffs would resume following “National Security Tariff Investigations”, adding further uncertainty to an already volatile trade environment.
Trump took to Truth Social on Sunday, insisting that no tariff exemptions had been made, despite the US Customs and Border Protection announcing on Friday that electronic devices – including smartphones, computers, and other components – were exempt from the tariffs: 145% on imports from China and 10% on those from other countries. The White House confirmed the exemptions on Saturday.
China’s Ministry of Commerce responded to the US decision on electronics, calling the move as “a small step” in correcting the US’s wrongful imposition of unilateral reciprocal tariffs. The spokesperson stated: “We urge the US side to heed the rational voices of the international community and various domestic sectors, to take a major step toward correcting its mistakes, to completely abandon the erroneous practice of ‘reciprocal tariffs’, and to return to the right path of mutual respect and resolving differences through equal dialogue.”
“NOBODY is getting ‘off the hook’ for the unfair Trade Balances, especially not China, which, by far, treats us the worst!” Trump posted in Truth Social later on Sunday, “There was no Tariff ‘exception’ announced on Friday,” he added, while noting that the administration was “taking a look at Semiconductors and the WHOLE ELECTRONICS SUPPLY CHAIN” as part of the upcoming National Security Tariff Investigations. He also confirmed that electronics would be subject to the 20% Fentanyl Tariffs, stating, “They are just moving to a different Tariff ‘bucket.’ The Fake News knows this but refuses to report it.”
US Secretary of Commerce Howard Lutnick also confirmed during an interview with ABC News earlier on Sunday that the exemptions “are not permanent” and that new tariffs “are coming in probably a month or two.”
European markets set to open higher as sentiment improves
European markets are set to open higher, even as Trump hinted at a tariff reversal in the near future. As of 5:00 am CEST, stock futures were broadly positive, with the Euro Stoxx 50 rising 2.5%, Germany’s DAX up 2.28%, and the UK’s FTSE 100 gaining 2.01%.
The euro also surged against the US dollar, as the dollar extended weakness amid heightened economic uncertainty. The EUR/USD pair climbed above 1.04 before retreating slightly during the early Asian session.
In the US, stock futures rose in early Monday trade following the weekend’s policy developments. The tech-heavy Nasdaq Composite jumped 1.3%, the S&P 500 gained 0.85%, and the Dow Jones Industrial Average edged up 0.24% as of 5:05 am CEST.
Technology stocks in the US are expected to be in focus, as the sector was among the hardest hit by Trump’s reciprocal tariffs. Apple, in particular, was one of the worst performers before the recent market rebound, tumbling 22% before last Wednesday’s historic rally when Trump announced the 90-day tariff pause. With much of its manufacturing based in China, Apple is especially vulnerable to import levies, and analysts had warned of significant pressure on the company’s profit margins. The electronics exemption may thus provide a catalyst for a short-term rebound in Apple shares.
Asian markets rally, led by Hang Seng gains
Asian markets also gained, with Hong Kong’s Hang Seng Index leading the charge. The index climbed 2.42% as of 5:20 am CEST after China reported a 12% year-on-year increase in exports last month. However, analysts believe the surge may reflect front-loading by exporters attempting to beat the deadline for new tariffs, raising concerns of a potential slowdown in the coming months.
Other major regional indices also advanced. Japan’s Nikkei 225 rose 1.85%, Australia’s ASX 200 climbed 1.52%, and South Korea’s Kospi gained 0.76% in the same time frame.