By Krystal Hur and Joe Wallace

Stocks started the week on an upbeat note, with investors welcoming the U.S.'s latest pivot on trade that would limit the tariffs it is set to introduce next week.

The Nasdaq Composite jumped 2.3%, leading the session's gains. The S&P 500 added 1.8%, and the Dow Jones Industrial Average rose 1.4%, or nearly 600 points.

"Any respite from the tariff narrative feels like a sigh of relief for this market," said Sarah Henry, managing director at Logan Capital Management.

All 11 sectors of the S&P 500 climbed Monday, except for the utilities sector. Consumer-discretionary stocks, which have slumped recently on concerns that higher import levies would dent consumer spending, led the charge higher.

Big tech stocks rose. Tesla shares jumped 12% Monday, a bright spot in what has been a rough start to the year for the maker of electric vehicles. The market's other dominant "Magnificent Seven" tech stocks -- Apple, Microsoft, Alphabet, Amazon.com, Nvidia and Meta Platforms -- also gained.

President Trump had said he would impose tariffs to match those aimed at the U.S. by trading partners starting on April 2.

But the planned reciprocal action looks set to be more targeted than originally thought, The Wall Street Journal reported. The administration has narrowed its focus to about 15% of nations running persistent trade imbalances with the U. S. -- dubbed the "dirty 15" by Treasury Secretary Scott Bessent.

Trump said Monday that tariffs on automobiles, semiconductors and pharmaceuticals might not be implemented until after April 2.

Though the measures under consideration still amount to a shock to world trade, they fall short of the worst-case economic scenarios investors had been girding for.

Solid economic data out Monday gave investors another reason for optimism. The latest S&P Global Flash U.S. Composite PMI, which measures manufacturing and services activity, showed that U.S. growth accelerated in March, thanks to an upturn in services.

The Cboe Volatility Index, or VIX, which measures expectations for where the stock market is headed through S&P 500 options, fell to its lowest level this month.

Some investors say that Monday's gains could be a short-lived reprieve for Wall Street. Markets have whipsawed in recent weeks, battered by tariff developments, recession fears and cracks in the once high-flying artificial-intelligence trade.

"I am a little concerned about the April 2 announcements. We may have more questions than answers coming out of it," said Dustin Thackeray, chief investment officer at Crewe Advisors. "Uncertainty and volatility [are] kind of the keywords for the time being."

Other factors that could jolt markets down the line include ongoing wars between Ukraine and Russia, as well as Israel and Hamas, the looming U.S. debt ceiling and negotiations over Trump's tax-cut plan, said Thackeray.

Elsewhere, Treasury yields advanced. The 10-year yield rose to 4.33%, up from 4.25% on Friday.

European stocks edged lower. Stock indexes rose in Hong Kong and mainland China but fell in Japan.

Write to Krystal Hur at krystal.hur@wsj.com and Joe Wallace at joe.wallace@wsj.com

(END) Dow Jones Newswires

March 24, 2025 16:32 ET (20:32 GMT)

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