US stock market futures explode higher as Trump seals shocking $550B Japan trade deal—Dow and S&P 500 to record highs
Index Change Key Drivers Dow Jones +0.4 % (≈+0.5% futures) Boosted by the U.S.–Japan trade deal easing tariffs and improving auto sector sentiment S&P 500 +0.1 % to +0.3% (futures +0.37%) Hit a fresh all-time high, led by cyclical sectors and record earnings momentum Nasdaq –0.4 % (–0.39% premarket) Tech lagged due to profit-taking in mega caps; chip-related stocks under pressure
Key highlights of the U.S.–Japan trade deal
$550 billion investment from Japan into U.S. infrastructure, energy, and manufacturing projects.
from Japan into U.S. infrastructure, energy, and manufacturing projects. Auto tariffs reduced : The 25% threatened tariff on Japanese vehicles was slashed to 15%.
: The 25% threatened tariff on Japanese vehicles was slashed to 15%. Revenue sharing agreement with a 90/10 split favoring U.S. companies.
agreement with a 90/10 split favoring U.S. companies. President Trump hailed the deal as 'one of the biggest and most beautiful trade agreements in U.S. history,' claiming it would create 'millions of jobs.'
How the stock market reacted
Dow Jones Industrial Average futures climbed over 0.5% .
climbed over . S&P 500 futures rose 0.37% , pushing the index to a new all-time high.
rose , pushing the index to a new all-time high. Nasdaq 100 futures edged up 0.16% , supported by gains in tech and auto stocks.
edged up , supported by gains in tech and auto stocks. Asian markets soared: Japan's Nikkei jumped 3.5% , while South Korea and Hong Kong indices also saw gains.
soared: Japan's Nikkei jumped , while South Korea and Hong Kong indices also saw gains. European markets responded positively, with London's FTSE 100 rising 0.5%.
Market drivers: Why investors are optimistic
Live Events
Toyota (TM) surged over 13%
surged over Mazda (MZDAF) jumped 17%
jumped Honda (HMC) rose 11%
rose Ford (F) and General Motors (GM) gained around 2–3% in pre-market trading
What to watch next
Earnings season continues, with big reports expected from Tesla, Alphabet (Google), AT&T, and Texas Instruments.
continues, with big reports expected from Tesla, Alphabet (Google), AT&T, and Texas Instruments. Traders are also eyeing the Federal Reserve's upcoming meeting for clues on future interest rate cuts.
for clues on future interest rate cuts. Speculation is growing around similar trade pacts with the European Union and China, which could fuel further rallies if agreements are reached before the next round of tariffs.
Top Stocks to Watch
Ups (Top Gainers & Premarket Movers)
GE Vernova (GEV) : Up ~6% after strong Q2 results and raised guidance.
: Up ~6% after strong Q2 results and raised guidance. Tesla (TSLA) : Slightly higher premarket; eyes on Q2 earnings and Elon Musk's robotaxi remarks.
: Slightly higher premarket; eyes on Q2 earnings and Elon Musk's robotaxi remarks. Alphabet (GOOG) : Modest gains ahead of earnings; focus on AI/cloud and data-centre spending.
: Modest gains ahead of earnings; focus on AI/cloud and data-centre spending. Capital One (COF) : +3.3% after reporting strong adjusted earnings despite a net loss.
: +3.3% after reporting strong adjusted earnings despite a net loss. Medpace (MEDP): Surged ~55%, standout gainer in healthcare.
Downs (Notable Declines)
Texas Instruments (TXN) : Plunged ~11% post-earnings due to weak Q3 guidance.
: Plunged ~11% post-earnings due to weak Q3 guidance. SAP : -4.1% premkt despite earnings beat; cloud revenue slightly missed expectations.
: -4.1% premkt despite earnings beat; cloud revenue slightly missed expectations. Enphase Energy (ENPH) : -6.8% after cautious revenue outlook.
: -6.8% after cautious revenue outlook. AT&T (T): Down ~0.4% despite beating Q2 estimates; guidance perhaps underwhelming
A win for markets, but eyes remain on next moves
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Wall Street opened on a high note Wednesday morning as Dow Jones, S&P 500, and Nasdaq futures surged following President Trump's announcement of a new trade agreement with Japan. The landmark deal, unveiled late Tuesday, includes a $550 billion Japanese investment into U.S. industries and a reduction in previously proposed tariffs on Japanese auto imports.The positive momentum lifted investor sentiment across global markets, helping push the S&P 500 to fresh record territory and driving sharp rallies in Japanese and European stocks.Following the news:The deal eased investor concerns around escalating trade tensions and opened the door for potential deals with other major economies. Market analysts say the timing is critical, coming just ahead of thefor broader tariff implementation on global partners.Auto stocks were the biggest beneficiaries:While the deal is a strong positive for near-term sentiment, several factors will shape the market outlook in the coming days:Despite the bullish tone, experts warn that tariffs on some goods remain above pre-Trump levels, which may keep inflation pressures elevated. Economists also note that any disruption in follow-up negotiations could trigger a market pullback.President Trump's U.S.–Japan trade deal has injected fresh optimism into the global economy. While investors celebrate the immediate boost, the market's future performance will hinge on how quickly follow-up deals materialize—and how Q2 earnings unfold.The agreement includes a $550 billion Japanese investment in U.S. industries and lowers tariffs on Japanese auto imports from 25% to 15%, favoring U.S. manufacturers with a 90/10 profit-sharing structure.Dow futures rose 0.5%, S&P 500 hit a record high with a 0.37% gain, while Nasdaq slipped 0.39% as tech stocks came under pressure.
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