WASHINGTON — Facing a global market meltdown, President Donald Trump on Wednesday abruptly backed down on his tariffs on most nations for 90 days, but raised the tax rate on Chinese imports to 125%.

It was seemingly an attempt to narrow what had been an unprecedented trade war between the U.S. and most of the world to a showdown between the U.S. and China, but the drama over Trump’s tariffs will now be prolonged as the administration engages in negotiations that could cause uncertainties to persist in the world economy.

Stocks surged to one of their biggest gains since World War II after Trump declared a halt, as investors had desperately hoped he would.

After sinking earlier in the day, the S&P 500 was up 9.5%, though the index is still below where it was when Trump announced his sweeping set of tariffs last week.

The Dow Jones Industrial Average shot up nearly 3,000 points, erasing an earlier loss of nearly 370 points. The Nasdaq composite was 12.2% higher, a gain that would count as a good year for the broad stock market.

Trump posted on Truth Social that because “more than 75 Countries” had reached out to the U.S. government for trade talks and have not retaliated in a meaningful way “I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately.”

The president later told reporters that he pulled back on many global tariffs — but not on China — because people were “yippy,” and “afraid,” adding that while he expected to reach deals that “nothing’s over yet.”

The president said he had been watching the bond market and that people were “getting a little queasy.” But after his tariff pause, Trump described the bond market as “beautiful.”

It seemed impossible to fully deny the pressure created by volatile financial markets that had been pushing Trump to reconsider his tariffs, even as administration officials said the reversal had always been the plan. The pause was announced after the global economy appeared to be in open rebellion against Trump’s tariffs as they took effect Wednesday, a signal that the president was not immune from market pressures.

The 10% tariff was the baseline rate for most nations that went into effect on Saturday. It’s meaningfully lower than the 20% tariff that Trump had set for goods from the European Union, 24% on imports from Japan and 25% on products from South Korea. Still, 10% would represent an increase in the tariffs previously charged by the U.S. government.

Treasury Secretary Scott Bessent said that the negotiations with individual countries would be “bespoke,” meaning that the next 90 days would involve talks on a flurry of potential deals. Bessent, a former hedge fund manager, told reporters that the pause was because of other countries seeking talks rather than brutal selloffs in the financial markets.

“The only certainty we can provide is that the U.S. is going to negotiate in good faith, and we assume that our allies will too,” Bessent said.

The Treasury secretary said he and Trump “had a long talk on Sunday, and this was his strategy all along” and that the president had “goaded China into a bad position.” Bessent said that Canada and Mexico would now be tariffed at 10%, even though those two countries had been tariffed by as much as 25% by Trump ostensibly to address fentanyl smuggling and illegal immigration.

Trump’s latest tariffs had hit nearly all U.S. trading partners with new levies and raised import taxes on Chinese goods to 104%. Beijing then announced additional tariffs on imports from the United States, for a total levy of 84%, which went into effect at 12:01 p.m. Eastern time.

Shortly before that, European Union member states voted to approve countertariffs against the United States that would take effect Tuesday, its first response to Trump’s levies. Documents showed that duties of 25% would be applied to a wide range of goods, including products as varied as corn and plate glass. The bloc said its countermeasures “can be suspended at any time, should the U.S. agree to a fair and balanced negotiated outcome.”

Prior to the reversal, business executives were warning of a potential recession caused by his policies, some of the top U.S. trading partners have prepared to retaliate with their own import taxes and the stock market quivered after days of decline.

White House press secretary Karoline Leavitt said the walk-back was part of Trump’s negotiating strategy.

Leavitt said that the news media “clearly failed to see what President Trump is doing here. You tried to say that the rest of the world would be moved closer to China, when in fact, we’ve seen the opposite effect the entire world is calling the United States of America, not China, because they need our markets.”

But market pressures had been building for weeks ahead of Trump’s move, with the president at times suggesting the import taxes would stay in place while also saying that they could be subject to negotiations.

Particularly worrisome was that U.S. government debt had lost some of its luster with investors, who usually treat Treasury notes as a safe haven when there’s economic turbulence. Government bond prices had been falling, pushing up the interest rate on the 10-year U.S. Treasury note to 4.45%. That rate eased after Trump’s reversal.

The New York Times contributed.