Stocks look set to rise on Wednesday after the U.S. brokered a trade deal with Japan, giving investors another reason to feel cheerful about tariffs ahead of the Aug. 1 deadline.
Futures tracking the Dow Jones Industrial Average climbed 133 points, or 0.3%. S&P 500 futures also rose 0.3%, a day after notching yet another record close, and contracts tied to the tech-heavy Nasdaq 100 added 0.2%.
President Donald Trump late Tuesday said he had struck a trade deal that will reset tariffs on goods from Japan imported to the U.S. to 15%, which is lower than the 25% he threatened in a letter earlier this month.
Trump wrote in a post on Truth Social that it was “perhaps the largest Deal ever made,” adding that Tokyo had agreed to invest $550 billion “at my direction,” with the U.S. receiving 90% of the profit.
The pact with Japan comes at a time when jitters about Trump’s tariffs were resurfacing, with just over a week to go until a deadline when he’s pledged that levies will revert to rates set on April 2 or from letters sent more recently. Still, investors will want to see more progress on the trade front over the next few days.
“This more positive trade news has really helped to ease investor fears that tariffs are about to snap back higher,” Deutsche Bank macro strategist Jim Reid said. “But of course, the threat of much higher tariffs still remains for several large economies, including the 30% on the European Union, 35% on Canada and 50% on Brazil.”
Wireless carrier AT&T and copper miner Freeport-McMoRan are among the companies set to report ahead of Wednesday’s opening bell, with Big Tech giants Alphabet and Tesla due up after the close.
The yield on the benchmark 10-year Treasury note climbed 3 basis points to 4.381% on Wednesday. The U.S. dollar was flat against a weighted basket of its peers, and gold prices slid 0.1% to $3,441 per Troy ounce.