Stocks rose after the Trump administration announced a significant reduction in tariffs on small parcels imported from China. The move, aimed at easing trade tensions between Washington and Beijing, benefited major e-commerce giants such as Amazon and Meta Platforms.
On Monday, the White House issued an executive order lowering tariffs on so-called “de minimis” goods—parcels valued under $800—shipped from mainland China and Hong Kong. Previously, these packages could enter the U.S. duty-free, but in April, President Donald Trump suspended this exemption, imposing a 120% tariff on such goods starting May 2.
This change has profound implications for e-commerce retailers like Temu and Shein, which directly import low-priced packages from China to U.S. consumers. With their growing popularity, these platforms had been heavily utilizing the tariff exemption, resulting in substantial costs when the policy was altered.
However, the tariff reduction is also a boost for Amazon, a direct competitor of Temu. Analysts believe the tariff hikes posed a greater threat to Temu than to Amazon, which has been expanding its Chinese direct-sales model with a new section on its website called Amazon Haul. The decision to reduce tariffs could ease some of the pressure on Amazon’s cost structure, particularly after the company faced challenges last month, attempting to list the shipping fees of Haul products separately, a move opposed by the White House.
On the stock market today, Amazon’s shares surged over 2%, rising to $214.17. This follows a brief 8% jump earlier this week after both the U.S. and China agreed to lower tariffs in the next 90 days. Amazon’s stock is now approaching its mid-February highs.
The tariff reduction also had a positive impact on Meta Platforms. Both Temu and Shein had become major advertisers on social media platforms like Facebook and Instagram. Temu, for instance, was one of the largest ad buyers on these platforms in 2023 and 2024. In the wake of the tariff announcement, both Temu and Shein significantly reduced their U.S. advertising spend, a trend Meta’s CFO, Susan Li, acknowledged last month, attributing it to the expected end of the tariff exemption. However, she noted that some of the ad spend had shifted to other markets.
The question of whether Temu and Shein will increase their U.S. ad spending following the tariff reduction remains uncertain. A recent Wall Street Journal report indicated that Temu would no longer ship directly from China, instead focusing on its local logistics operations in the U.S.
Meta’s stock price rose more than 3% to $660, with a notable 8% increase on Monday.
Meanwhile, shares of Pinduoduo (PDD), the parent company of Temu, increased by 3%, reaching $120.
The announcement also drove significant market shifts in the broader tech sector, with companies like Sea Ltd. posting strong earnings despite missing revenue expectations.
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U.S. Stock Rise as Trade War Tensions Ease
