U.S. stocks rallied Tuesday after the Trump administration backed off on imposing tariffs on some Chinese imports from Sept. 1, following recent sharp falls in equity markets and ahead of possible higher prices for consumer goods later this year due to the proposed levies.

The news of a de-escalation in the trade war overshadowed concerns about slowing economic growth and the potential for Beijing to crack down on protests in Hong Kong, one of Asia’s most important financial and trade hubs.

How are the major benchmarks performing?

The Dow Jones Industrial Average DJIA, +1.56% was up 429 points, or 1.7%, at 26,324, while the S&P 500 index SPX, +1.64%  added 49 points, or 1.7%, to 2,930. The Nasdaq Composite index COMP, +2.05%   rose 165 points, or 2.0%, to 8,030.

On Monday, the Dow slumped 389.73 points, or 1.5%, to end at 25,897.71, while the S&P 500 declined 35.56 points, or 1.2%, to finish at 2,883.09. The Nasdaq Composite  closed at 7,863.41, a fall of 95.73 points or 1.2%.

What’s driving the market?

Some investors took Tuesday’s announcement as a sign that despite the White House’s claim that China would bear the cost of the tariffs, the trade war was starting to hurt U.S. consumers.

Early Tuesday U.S. Trade Representative announced major revisions to the planned 10% tariff on $300 billion in annual imports from China earlier announced by President Trump on August 1.

Products that will not be subject tariffs from September include “cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing,” according to the statement.

A USTR spokesman also told MarketWatch that U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin held discussions with Chinese Vice Premier Liu He, and officials would speak again within two weeks.

According to Chinese news outlet CGTN, the call for the world’s two largest economies to meet again on trade came from Lighthizer, not China.

“These developments are modestly positive, especially compared to the recent torrent of negative news, but we caution against viewing the tariff delay as anything more than an attempt to partially shield the American consumer heading into the holiday season,” Isaac Boltansky of Compass Point Research wrote in a note to clients. “We continue to believe that a broad deal will not emerge prior to the 2020 election.”

Geopolitical risk remains a factor for investors though with protesters thronging Hong Kong International Airport for a second day in a row Tuesday, a day after they forced the transport hub to shut down entirely. The number of protesters has fallen from an estimated 2 million who marched on June 16th to 350,000 during the general strike which disrupted transport last week, but the protests have grown more violent.

Hong Kong accounts for only about 3% of China’s GDP currently, down from 20% before the U.K. handover to China in 1997, but Hong Kong hosts the world’s fourth largest stock exchange and cross border banking has doubled in the past decade with much of it for Chinese companies borrowing in U.S. dollars. About 60% of the $2 trillion of foreign direct investment into China flows through Hong Kong.

Opinion: A Tiananmen ‘solution’ in Hong Kong would destroy its economy

Argentina is again a concern for investors also after a plunge by the Argentine peso USDARS, +4.9110%  following a poor showing by pro-business President Mauricio Macri in a primary election on Sunday.

“Developments in the financial hub of Hong Kong are adding to an already tense geopolitical picture amid ongoing U.S.-Sino trade tensions,” said Fiona Cincotta, senior market analyst at City Index in a note. “Investors are once again pulling out of riskier assets such as equities,” while flows into haven assets are on the rise.”

Read: How Hong Kong clashes could wallop the U.S. stock market

See: Argentina fund swoons as Macri suffers primary defeat

Concerns about Hong Kong are adding to doubts on the global economic outlook, which were also reinforced by downbeat data from the eurozone’s largest economy. The ZEW indicator of German economic sentiment fell to -44.1 in August, down from -24.5 in July and marking the lowest reading since December 2011. Economists polled by FactSet had looked for a -28 reading.

On the U.S. data front, the cost of living over the past 12 months climbed to 1.8% from 1.6%, but it’s still well below last year’s peak of 2.9%. The survey of consumer prices tends to run hotter than the Fed’s preferred inflation barometer known as the price index for personal consumption expenditures. The PCE is up just 1.4% over the past year, well below the Fed’s 2% inflation target.

Which stocks are in focus?

Apple AAPL, +4.59%  was up more than 4% after news that some computer products would avoid tariffs for now. Best Buy BBY, +6.38%   rose by more than 6% on the tariff delay also.

U.S.-listed shares of J.D.com JD, +13.37%  rose 10.2% Tuesday, after the China-based e-commerce company reported second-quarter earnings that beat expectations.

Shares of Genworth Financial Inc. GNW, +15.32%  rallied 13% Tuesday, after the insurer announced an agreement to sell a majority stake in Genworth MI Canada to Brookfield Business Partners LP for about C$2.4 billion ($1.8 billion).

Shares of CIT Group CIT, -3.85%  were expected to be in focus after it announced its CIT Bank N.A. subsidiary was in a deal to buy Mutual of Omaha’s savings bank subsidiary, Mutual of Omaha Bank, for $1 billion in cash and stock. The stock fell 3.2% Tuesday.

How are other markets trading?

European stocks also staged a turnaround following the trade news, with the Stoxx Europe SXXP, +0.54%  rising 0.5% after falling as much as 1% earlier Tuesday.

Safe-have assets also reversed course early Tuesday, with the yield on the 10-year U.S. Treasury note TMUBMUSD10Y, +1.50%, erasing declines to be up 4 basis points at 1.68%, while gold futures GCZ19, -0.34%  fell about 0.2% to $1,501 per ounce. The spread between two- and 10-year yields hit the narrowest since 2007.

The price of crude oil CLU19, +3.91%  rose 3.7% to about $57.

Asian markets declined overnight Monday as investors kept an eye on developments in Hong Kong, with the Hang Seng Index HSI, -2.10%  falling 2.1%, bringing its August decline to 9%. China’s CSI 300 000300, -0.90%  lost 0.9% and Japan’s Nikkei 225 NIK, -1.11%  shed 1.1% overnight.