US equity indexes rose while volatility dropped with the dollar after China announced retaliatory tariffs.

The Nasdaq Composite jumped 1.2% to 19,618.9, the S&P 500 advanced 0.6% to 6,031.6, and the Dow Jones Industrial Average climbed 0.1% to 44,456.8 after midday on Tuesday. Technology, consumer discretionary, and communication services led the gainers intraday.

China plans to impose 15% tariffs on US coal and liquefied natural gas imports and a 10% tariff on crude oil, agricultural machinery, large-displacement cars, and pickup trucks. The move follows the Trump administration's announcement of a 10% additional tariff on imports from China late Friday.

President Donald Trump allowed a 30-day pause in his administration's plan to levy 25% punitive tariffs on Mexico and Canada following telephone conversations with his counterparts in the neighboring countries. Trump will speak with Chinese President Xi Jinping "in the next couple of days," Reuters reported, citing White House press secretary Karoline Leavitt.

The CBOE's Vix index, also known as the fear gauge for investors, slumped 8.3%, and the US dollar index sank 0.9% intraday.

In economic news, US job openings fell to 7.6 million in December, according to the Bureau of Labor Statistics, lower than the 8 million openings expected in a survey compiled by Bloomberg and down from the 8.156 million openings reported in November.

US Treasury yields traded mixed intraday. The 10-year was steady at 4.54%, while the two-year fell 4.1 basis points to 4.22%.

West Texas Intermediate crude oil futures fell 3% to $70.95 a barrel.

In company news, Palantir Technologies (PLTR) shares increased 23% intraday, the top performer on the S&P 500 and the Nasdaq, after the company reported late Monday higher Q4 adjusted earnings and revenue. Goldman Sachs adjusted Palantir's price target to $80 from $41.

Merck (MRK) shares sank 10% intraday, the steepest decliner on the S&P 500 and the Dow, after the company's 2025 guidance for non-GAAP earnings and sales trailed analysts' expectations.