New Delhi, May 12 : Wall Street kicked off the week with a powerful surge on Monday, as major US stock indexes soared after the United States and China struck a long-awaited deal to reduce tariffs.

The agreement, which aims to ease tensions in the ongoing trade war between the two largest economies, lifted investor confidence and sparked a global market rally.

The Dow Jones Industrial Average jumped 1,037.13 points, or 2.51 per cent, at 42,286.51.

The broader S&P 500 climbed 150.24 points, or 2.65 per cent, to trade at 5,810.15, while the tech-heavy Nasdaq surged 621.90 points, or 3.47 per cent, at 18,550.82.

The rally was fuelled by news that Washington and Beijing have agreed to roll back most of the tariffs that had weighed heavily on global trade and threatened to push the US economy into recession.

Economists had warned that continued tariffs could lead to higher prices and shortages for American consumers.

Crude oil prices also spiked, reflecting expectations of increased demand in a global economy less burdened by trade barriers.

The US dollar strengthened against major currencies, and Treasury yields rose, as investors moved money into riskier assets and away from safe havens.

The upbeat sentiment on Wall Street echoed across the globe, contributing to an equally strong rally in Indian markets.

Earlier in the day, the Sensex and Nifty posted their biggest single-day gains in four years, buoyed not only by global cues but also by a ceasefire understanding between India and Pakistan and progress in Russia-Ukraine peace talks.

Indian investors saw their wealth grow by over Rs 16 lakh crore in a single session, with all sectoral indices closing in the green.

The global relief rally reflects a broader return of risk appetite among investors, who had been cautious amid geopolitical tensions and trade uncertainties.

Market analysts say that easing tensions between major global powers is a key driver of the current momentum.

/IANS