The stock market rally on Monday was reportedly driven by investor optimism for a new approach to tariffs, according to CNBC’s Jim Cramer.

What Happened: Cramer attributed the market rebound to the potential for a more transparent future in global trade. He suggested that the crucial element was the prospect of a plan that would allow foreign nations or companies to offset tariffs, as per a CNBC report. “It’s a path, and once you get a path, you get possible transparency and certainty. And that’s what stock markets like,” Cramer explained.

Despite caution over President Donald Trump‘s tariff plans, investors were hopeful. The President’s hints at potential tariff breaks for “a lot of countries” added to the positive sentiment.

While Cramer didn’t rule out the possibility of Trump reverting to stricter tariff policies, he suggested that the President may have considered the market’s reaction when it entered a correction phase a few weeks ago. Major companies, including Stargate, Apple Inc. ( AAPL ) , Taiwan Semiconductor , and Hyundai, are beginning to commit to manufacturing in the U.S., adding to the upbeat sentiment.

"Those are wins. Big wins," stated Cramer. "There's now a paradigm that companies can follow if they want to have access to our markets."

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Why It Matters: The market rally on Monday was influenced by President Trump’s softer tone on potential tariffs ahead of the April 2, 2025 deadline, easing trade tension concerns. Additionally, strong economic data, including a significant rebound in services activity in March, helped alleviate recession fears.

Furthermore, the tech sector, particularly the “Mag Seven” stocks, could face a significant impact from the new tariffs set to take effect on April 2, as noted by Gene Munster, managing partner at Deepwater Asset Management. This date, dubbed the ‘Vortex Day’ by Munster, is also significant as it coincides with the release of Tesla’s delivery numbers, which are expected to be weaker than anticipated.

On Monday, the Dow Jones Industrial Average increased by 1.42%, the S&P 500 rose 1.76%, and the Nasdaq Composite grew 2.27%.

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.