U.S. and Chi­nese of­fi­cials said Mon­day they had reached a deal to roll back most of their re­cent tar­iffs and call a 90-day truce in their trade war for more talks on re­solv­ing their trade dis­putes.

Stock mar­kets rose sharply as the globe’s two ma­jor eco­nom­ic pow­ers took a step back from a clash that has un­set­tled the glob­al econ­o­my.

U.S. Trade Rep­re­sen­ta­tive Jamieson Greer said the U.S. agreed to drop its 145% tar­iff rate on Chi­nese goods by 115 per­cent­age points to 30%, while Chi­na agreed to low­er its rate on U.S. goods by the same amount to 10%.

Greer and Trea­sury Sec­re­tary Scott Bessent an­nounced the tar­iff re­duc­tions at a news con­fer­ence in Gene­va.

The two of­fi­cials struck a pos­i­tive tone as they said the two sides had set up con­sul­ta­tions to con­tin­ue dis­cussing their trade is­sues. Bessent said at the news brief­ing af­ter two days of talks that the high tar­iff lev­els would have amount­ed to a com­plete block­age of each sides goods, an out­come nei­ther side wants.

“The con­sen­sus from both del­e­ga­tions this week­end is nei­ther side wants a de­cou­pling,” Bessent said. “And what had oc­curred with these very high tar­iff ... was an em­bar­go, the equiv­a­lent of an em­bar­go. And nei­ther side wants that. We do want trade.”

“We want more bal­anced trade. And I think that both sides are com­mit­ted to achiev­ing that.”

The del­e­ga­tions, es­cort­ed around town and guard­ed by scores of Swiss po­lice, met for at least a dozen hours on both days of the week­end at sun-baked 17th-cen­tu­ry vil­la that serves as the of­fi­cial res­i­dence of the Swiss am­bas­sador to the Unit­ed Na­tions in Gene­va.

At times, the del­e­ga­tion lead­ers broke away from their staffs and set­tled in­to so­fas on the vil­la’s pa­tios over­look­ing Lake Gene­va, help­ing deep­en per­son­al ties in the ef­fort to reach a much-sought deal.

Chi­na’s Com­merce Min­istry said the two sides agreed to can­cel 91% in tar­iffs on each oth­er’s goods and sus­pend an­oth­er 24% in tar­iffs for 90 days, bring­ing the to­tal re­duc­tion to 115 per­cent­age points.

The min­istry called the agree­ment an im­por­tant step for the res­o­lu­tion of the two coun­tries’ dif­fer­ences and said it lays the foun­da­tion for fur­ther co­op­er­a­tion.

“This ini­tia­tive aligns with the ex­pec­ta­tions of pro­duc­ers and con­sumers in both coun­tries and serves the in­ter­ests of both na­tions as well as the com­mon in­ter­ests of the world,” a min­istry state­ment said.

Chi­na hopes the U.S will stop “the er­ro­neous prac­tice of uni­lat­er­al tar­iff hikes” and work with Chi­na to safe­guard the de­vel­op­ment of their eco­nom­ic and trade re­la­tions, in­ject­ing more cer­tain­ty and sta­bil­i­ty in­to the glob­al econ­o­my, the min­istry said.

The joint state­ment is­sued by the two coun­tries said Chi­na al­so agreed to sus­pend or re­move oth­er mea­sures it has tak­en since April 2 in re­sponse to the U.S. tar­iffs.

Chi­na has in­creased ex­port con­trols on rare earths in­clud­ing some crit­i­cal to the de­fense in­dus­try and added more Amer­i­can com­pa­nies to its ex­port con­trol and un­re­li­able en­ti­ty lists, re­strict­ing their busi­ness with and in Chi­na.

The full im­pact on the com­pli­cat­ed tar­iffs and oth­er trade penal­ties en­act­ed by Wash­ing­ton and Bei­jing re­mains un­clear. And much de­pends on whether they will find ways to bridge long­stand­ing dif­fer­ences dur­ing the 90-day sus­pen­sion.

But in­vestors re­joiced as trade en­voys from the world’s two biggest economies blinked, find­ing ways to pull back from po­ten­tial­ly mas­sive dis­rup­tions to world trade and their own mar­kets.

Fu­tures for the S&P 500 jumped 2.6% and for the Dow Jones In­dus­tri­al Av­er­age was up 2%. Oil prices surged more than $1.60 a bar­rel and the U.S. dol­lar gained against the eu­ro and the Japan­ese yen.

“This is a sub­stan­tial de-es­ca­la­tion,” said Mark Williams, chief Asia econ­o­mist at Cap­i­tal Eco­nom­ics. But he warned “there is no guar­an­tee that the 90-day truce will give way to a last­ing cease­fire.”

Jens Es­kelund, pres­i­dent of the Eu­ro­pean Union Cham­ber of Com­merce in Chi­na, wel­comed the news but ex­pressed cau­tion. The tar­iffs on­ly were sus­pend­ed for 90 days and there is great un­cer­tain­ty over what lies ahead, he said in a state­ment.

“Busi­ness­es need pre­dictabil­i­ty to main­tain nor­mal op­er­a­tions and make in­vest­ment de­ci­sions. The cham­ber there­fore hopes to see both sides con­tin­ue to en­gage in di­a­logue to re­solve dif­fer­ences, and avoid tak­ing mea­sures that will dis­rupt glob­al trade and re­sult in col­lat­er­al dam­age for those caught in the cross-fire,” Es­kelund said.

Trump last month raised U.S. tar­iffs on Chi­na to a com­bined 145% and Chi­na re­tal­i­at­ed by hit­ting Amer­i­can im­ports with a 125% levy. Tar­iffs that high es­sen­tial­ly amount to the two coun­tries boy­cotting each oth­er’s prod­ucts, dis­rupt­ing trade that last year topped $660 bil­lion.

The an­nounce­ment by the U.S. and Chi­na sent shares surg­ing, with U.S. fu­tures jump­ing more than 2%. Hong Kong’s Hang Seng in­dex surged near­ly 3% and bench­marks in Ger­many and France were both up 0.7%

The Trump ad­min­is­tra­tion has im­posed tar­iffs on coun­tries world­wide, but its fight with Chi­na has been the most in­tense. Trump’s im­port tax­es on goods from Chi­na in­clude a 20% charge meant to pres­sure Bei­jing in­to do­ing more to stop the flow of the syn­thet­ic opi­oid fen­tanyl in­to the Unit­ed States.

McHugh con­tributed from Frank­furt, Ger­many, Kurten­bach from Mi­to, Japan, and Morit­sugu from Bei­jing.

GENE­VA (AP) —