Shares of Boeing (BA.N) and Caterpillar (CAT.N), among the worst hit on Wednesday after China retaliated with $50 billion in tariffs on US goods such as soybeans, autos, and some types of aircraft, rose 1.7 percent and 3 percent.
The Dow Jones industrial average rose 240.92 points to 24,505.22, with Boeing and DowDuPont as the best-performing stocks.
Nine of the 11 major S&P sectors were higher, led by a 1.2 percent gain on the material.SPLRCM and the energy.SPNY indexes.
Over the course of the day 202 shares traded hands, as compared to an average volume of 2,300 over the last 30 days for Rex Gold Hedged S&P 500 ETF (NYSEARCA:GHS).
Stocks in the US are rising Thursday and major indexes in Europe are surging as global markets continue a rally that began late the previous day.
The Dow ended 572 points lower, closing at 23,932 for a 2.3 percent decline.
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Grain merchant Archer Daniels was down 2.8 percent, while Bunge slipped 2.5 percent. The tech-heavy NASDAQ also dropped more than 2 percent.
Trump, in a statement, said he proposed the additional tariffs "in light of China's unfair retaliation" against earlier USA actions that included $50 billion of tariffs on Chinese goods. JPMorgan Chase gained $1.79, or 1.6 percent, to $112.22 and Citigroup added $1.16, or 1.7 percent, to $70.47.
Briefing.com analyst Patrick O'Hare said investors were disappointed by the lack of reassurances from Trump administration officials, including Mnuchin, who told CNBC that the administration hoped to negotiate but acknowledged that a trade war was a possibility. Shares of Boeing, the single largest USA exporter to China, tumbled 4.6 percent. The Russell 2000 index of smaller-company stocks rose 9 points, or 0.6 percent, to 1,541.
The market had been interpreting Trump's proposed tariffs as negotiating tactics meant to extract concessions out of China rather than a rigid position.
The yield on the benchmark 10-year Treasury note settled at 2.830%, up from 2.788% on Wednesday.
Industrial companies were especially hard hit by the escalation in trade tensions Friday. Friday's jobs report failed to settle markets, as payrolls missed estimates and unemployment ticked up slightly in March, interrupting the market's rally from lows seen early in the week.
The May crude contract was down 61 cents to $62.90 per barrel and the May natural gas contract was up four cents to $2.73 per mmBTU.