President Trump declared the Middle East war definitively over while simultaneously walking back his China tariff threats, sending tech stocks soaring as markets embraced the dual dose of geopolitical optimism. The dramatic pivot from Friday's sell-off highlights how quickly Trump's messaging can reshape investor sentiment.
The tech sector got an unexpected gift this Monday as President Trump delivered a one-two punch of geopolitical optimism that sent investors scrambling back into growth stocks. Standing in Israel's Knesset, Trump declared the "long and painful nightmare" was finally over for both Israelis and Palestinians, giving reporters an unequivocal "yes" when asked if the Middle East war had ended, according to Reuters.
But it wasn't just Middle East peace driving the rally - Trump also appeared to walk back his aggressive China stance just days after hitting China with 100% additional tariffs that triggered Friday's tech sell-off. His Truth Social post declaring "it will all be fine" with China was all markets needed to hear.
The reversal was swift and decisive. Technology stocks led the charge higher as traders embraced what some are calling "TACO" - Trump's apparent willingness to cool tensions rather than escalate them. The whipsaw from Friday's tariff-induced panic to Monday's relief rally underscores just how sensitive tech valuations have become to Trump's messaging.
Broadcom emerged as the day's biggest winner, surging almost 10% after announcing a partnership with OpenAI to build and deploy custom chips. The deal represents a significant shift in the AI infrastructure landscape, potentially challenging Nvidia's dominant position as OpenAI's primary chip supplier. "This changes the competitive dynamics completely," said one semiconductor analyst who requested anonymity.
The OpenAI-Broadcom alliance also highlights the ChatGPT maker's growing influence across the tech ecosystem. Oracle CEO Larry Ellison recently suggested OpenAI has deep enough pockets to pay $60 billion annually for computing resources, positioning the company as what some analysts are calling "the tech sector's Santa Claus."
Meanwhile, quantum computing stocks got their own boost after JPMorgan Chase announced a $10 billion investment in sectors crucial to national interests. The bank's quantum computing push reflects growing Wall Street interest in next-generation technologies that could reshape financial services.
