CNBC Business News Update - Market Open: Stocks Soar After US-China Trade Talks, Dow Pops 1000 Points, Tariffs On Chinese Goods Now At 30% 5/12/25

Episode Date: May 12, 2025

From Wall Street to Main Street, the latest on the markets and what it means for your money. Updated regularly on weekdays, featuring CNBC expert analysis and sound from top business newsmakers. Anchored by CNBC's Jessica Ettinger.

I'm Jessica Ettinger CNBC. It's a trade inspired rally on Wall Street out of the gate after U.S. China talks over the weekend. The Dow soaring 1000 points at the open. Two and a half percent led higher by shares of Amazon up 8 percent. The S&P 500 index up 154 points. That's two and three quarters percent. And the Nasdaq popping 680 points.

That's almost 4%. Nvidia shares soaring 4% this morning. Reciprocal tariffs between both countries slashed for 90 days from 125% down to 10. The current 20% duties on Chinese imports relating to fentanyl, those are gonna stay. So total tariffs right duties on Chinese imports relating to fentanyl. Those are going to stay. So total tariffs right now on Chinese made goods coming in sit at 30%. Very agreeable meeting here.

We got a lot done over two days. So I would imagine that in the next few weeks we will be meeting again to get rolling on a more fulsome agreement. Treasury Secretary Scott Besant on CNBC from Geneva, Switzerland. Here's former US Senator Heidi Heitkamp on CNBC. Let's not kid ourselves. This is a good first step.

This didn't need to happen. It's an unforced error. We didn't need to take this step. I think if he had such a good relationship, he could have done this without threatening the livelihood of a lot of American small businesses. We'll see what the deal looks like when it's done. And the former head of the Office of Budget and Management in the Trump administration, Mick Mulvaney, said this on CNBC. Were tariffs there for the

purposes of rebuilding the manufacturing base in the U.S.? Are we going to be making textiles and shoes in this country again? Or were tariffs there for the purpose of leverage for negotiating deals? And I think now we pretty much know what the answer to that question is. This is leverage. Donald Trump is one of the best I've ever seen

at making leverage out of nothing. I do think it necessary. I think Heidi's absolutely right though. We are nowhere near having a deal. I think when we cut a deal with the Chinese back in 2018, it took us 18 months. The UK deal I think is still just a term sheet, so we're several months away there. So I count this, as Heidi mentioned, progress in the right direction, but certainly far

from final success. One economist tells CNBC that business decisions are likely just on hold right now. Economic activity over the next 90 days will be higher than it would have been otherwise, if only because people want to exploit a short-term window. My own gut feeling is we will get some slowing in the economy, we will get some higher inflation. I don't think we're gonna get any spike in unemployment. I think CEOs are just waiting.

They don't wanna take any major decisions that has longer-term consequences. If you lay someone off and it's wrong, you've gotta find someone else, retrain them. So any decisions that have longer-term implications, people will wait for now. Allianz economic adviser Mohammed Al-Aryan on CNBC. Apple reportedly considering another price increase for its iPhones this fall, not saying this would be linked to tariffs, but most of its iPhones are made in China. President

Trump expected to sign an executive order slashing drug prices today. Some big pharma shares are actually lower on this higher day. Bond yields are rising along with stocks. This means mortgage rates are poised to go toward 7 percent again, just as the spring housing market remains slow. Mortgage rates loosely follow the yield on the 10-year Treasury. And as of this morning, the average rate on a 30 year home loan is 6.89%. According to mortgage news daily, we'll see if it hits seven this afternoon. Disney's Thunderbolts won the weekend box office

for the second week in a row. And Warner Brothers, a Minecraft movie, has now passed Spider-Man in ticket sales, heading toward a billion dollars globally. Jessica Edinger, CNBC.