US-listed Chinese stocks jumped Tuesday after Bloomberg reported that the Trump team is considering a gradual approach to tariff hikes.

Online retailer JD.com (JD) spiked 4%, while Pinduoduo (PDD) jumped more than 2% and Baidu (BIDU) rose 1.8%. Alibaba (BABA) shares also climbed.

Chinese electric vehicle maker XPeng (XPEV) surged even higher, rising nearly 7%. The Volkswagen-backed EV company does not currently export its cars to the US, but the automaker has said entry into the US market is a long-term goal.

Citing unnamed sources, Bloomberg reported that Trump’s incoming economic team is contemplating a 2% to 5% monthly ramp-up in tariffs — a slower approach than the president-elect has previously suggested — to avoid spurring inflation.

Trump, the self-described “tariff man,” wrote in a post on his social media platform Truth Social in late November that he would impose a 10% tariff on goods from China "above any additional tariffs” on his first day in office. During his campaign, Trump took a more controversial approach, suggesting he’d hike tariffs on China to 60% or higher during his second term as US president.

Read more: How do tariffs work, and who really pays them?

US-listed Chinese equities, especially those of online retailers, fell after Trump’s election win in November as companies braced for impact.

Last week, CNN reported that Trump’s team is weighing the use of a national economic emergency declaration (International Emergency Economic Powers Act) to legally justify the tariffs. Henrietta Treyz, Veda Partners director of economic policy research, told Yahoo Finance in an interview following the report that such a dramatic scenario would allow Trump to deploy steep new tariffs in as little as 12 hours.

As Inauguration Day nears, economists have expressed concern that Trump’s immigration policies and tariffs could further spur inflation. Trump was a frequent critic of the persistently high prices seen during Biden’s presidency.

The consideration of a gradual tariff hike aims to avoid a spike in prices, Bloomberg reported. The plan would still involve the use of the International Emergency Economic Powers Act.

Yahoo Finance’s Ben Werschkul reports that Trump's use of the IEEPA would very likely result in lawsuits.

Laura Bratton is a reporter for Yahoo Finance. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.

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