Wall Street's "sell America" trade showed signs of breaking down on Wednesday as US stocks roared higher in a broad-based rally sparked by easing trade tensions.

Markets surged after a Wall Street Journal report said the White House is considering cutting tariffs on Chinese imports to as low as 50%, down sharply from the current 145%. The report added fuel to a rebound already underway following President Trump's softer stance on trade and monetary policy.

Treasury Secretary Scott Bessent later denied the Trump administration is considering unilaterally slashing tariffs on Chinese imports, which took some steam out of the rally.

In the days leading up to Wednesday's rebound, investors had been dumping both US stocks and traditional safe havens , with the 10-year Treasury yield ( ^TNX ) spiking above 4.4% and the US dollar ( DX-Y.NYB ) sinking to its lowest level since 2022.

The unusual move, pulling back from both risk assets and volatility hedges, is seen as a rare dislocation, with strategists dubbing it the infamous "sell America" trade. But those trends reversed sharply in early Wednesday trade: The 10-year yield dropped about seven basis points to around 4.3%, and the dollar edged closer to the psychologically important 100 level.

Meanwhile, gold ( GC=F ), which had set several records in recent days as investors flocked to non-dollar-denominated, globally recognized stores of value, retreated on Wednesday to around $3,290 per ounce — further signaling that the "sell America" trade was winding down.

In addition to favorable trade developments, Trump's decision to backtrack on his attempt to remove Federal Reserve Chair Jerome Powell helped calm investor concerns.

Since the president's "Liberation Day" announcement earlier this month, investors have been navigating a volatile market compounded by multiple economic shocks that include tariffs, slowing growth, and escalating geopolitical tensions.

Read more: The latest news and updates on Trump's tariffs

But the president has signaled he's been paying attention to the noise, leading some strategists to suggest he may now be more focused on market reactions to his policies than before. Previously, the Trump administration claimed that it was not monitoring the stock market during the recent sell-off.

"There was more of an attention paid to the market volatility, especially the 10-year yield , not just the stock market," Keith Lerner, Truist co-chief investment officer and chief market strategist, told Yahoo Finance. "I think there's a 'put' on how far or how high Trump will feel comfortable with the 10-year Treasury yield as well."