S&P 500 has its 3rd best day since 1940 and had been off 19% from an earlier record.

Anthony Matesic works on the floor at the New York Stock Exchange in New York on Wednesday. Seth Wenig - the associated press

By STAN CHOE | THE ASSOCIATED PRESS

U.S. stocks soared to one of their best days in history on a euphoric Wall Street Wednesday after President Donald Trump said he would back off on most of his tariffs temporarily, as investors had so desperately hoped he would.

The trade war is not over, and an escalating battle between the United States and China can still create plenty of damage.

U.S. stocks are also still below where they were just a week ago, when Trump announced worldwide tariffs on what he called "Liberation Day."

On Wednesday, the S&P 500 surged 9.5%, an amount that would count as a good year for the market. It had been sinking earlier in the day on worries that Trump's trade war could drag the global economy into a recession.

The Dow Jones Industrial Average rose to a gain of 2,962 points, or 7.9%. The Nasdaq composite leaped 12.2%. The S&P 500 had its third-best day since 1940.

The relief came after doubts had crept in about whether Trump cared about the financial pain the U.S. stock market was taking because of his tariffs. The S&P 500, the index that sits at the center of many 401(k) accounts, came into the day nearly 19% below its record set less than two months ago.

That surprised many professional investors, who had long thought that a president who used to crow about records for the Dow under his watch would pull back on policies if they sent markets reeling.

Wednesday's rally pulled the S&P 500 index away from the edge of what's called a "bear market." That's what professionals call it when a run-of-the-mill drop of 10% for U.S. stocks, which happens every year or so, graduates into a more vicious fall of 20%. The index is now down 11.2% from its record.

Wall Street also got a boost from a relatively smooth auction of U.S. Treasurys in the bond market Wednesday. Earlier jumps in Treasury yields had rattled the market, indicating increasing levels of stress. Trump himself said Wednesday that he had been watching the bond market "getting a little queasy."

Analysts say several reasons could be behind the rise in yields, including hedge funds and other investors having to sell their Treasury bonds to raise cash in order to make up for losses in the stock market. Investors outside the United States

may also be selling their U.S. Treasurys because of the trade war. Such actions would push down prices for Treasurys, which in turn would push up their yields.

Regardless of the reasons behind it, higher yields on Treasurys add pressure on the stock market and push upward on rates for mortgages and other loans for U.S. households and businesses.

The moves are particularly notable because U.S. Treasury yields have historically dropped - not risen - during scary times for the market because the bonds are usually seen as some of the safest possible investments. This week's sharp rise had brought the yield on the 10-year Treasury back to where it was in late February.

After approaching 4.50% in the morning, the 10-year yield pulled back to 4.34% following Trump's pause and the Treasury's auction. That's still up from 4.26% late Tuesday and from just 4.01% at the end of last week.

Wednesday's gains were widespread across the U.S. stock market, and 98% of the stocks in the S&P 500 index rallied.

Leading the way were airlines and other stocks that need customers feeling confident enough to travel for work or for vacation.

DeltaAir Lines soared 23.4%. Earlier in the day, it had pulled financial forecasts for 2025 as the trade war scrambles expectations for business and household spending and depresses bookings across the travel sector. All told, the S&P 500 rocketed higher by 474.13 points to 5,456.90. The Dow Jones Industrial gained 2,962.86 to 40,608.45, and the Nasdaq composite surged 1,857.06 to 17,124.97.