Wall Street surged on Wednesday (Thursday AEST) as renewed optimism over United States trade policy fuelled a broad-based market rally.
The Dow rose 507.9 points, or 1.1%, to finish at 45,010.3, just shy of a record high. The S&P 500 added 49.3 points, or 0.8%, to close at a new peak of 6,358.9 - its 12th record of the year. The Nasdaq Composite also climbed, gaining 127.3 points, or 0.6%, to close at 21,020, setting a fresh record of its own.
The rally followed a post from President Donald Trump on Truth Social late Tuesday, in which he revealed the U.S. had finalised a “massive Deal” with Japan. The agreement, which Trump said included “reciprocal” 15% tariffs on Japanese exports to the U.S., was touted as a step toward broader trade realignment.
Trump also confirmed the U.S. is in active discussions with the European Union to secure a similar deal. Optimism around those talks was bolstered after the Financial Times reported that Washington was nearing an agreement with the EU to mirror the 15% reciprocal tariff structure negotiated with Tokyo.
Bloomberg later corroborated the report, citing diplomats close to the negotiations.
The flurry of trade activity comes as the White House races to finalise agreements before an 1 August tariff deadline. Earlier in the week, the U.S. and Indonesia announced they had reached a framework for a bilateral trade deal, adding to a growing list of recent pacts with key trading partners, including the UK and China.
Markets had been volatile since Trump’s 2 April announcement of sweeping tariff increases, which were later delayed, stoking investor uncertainty. Wednesday’s developments helped restore confidence that the U.S. administration is shifting towards a more strategic trade approach.
After the closing bell, megacap tech giants Alphabet and Tesla released their quarterly results, kicking off the earnings season for the high-growth sector.
On the bond markets, 10-year and 2-year rates moved 0.8% and 1.3% higher to 4.384% and 3.884%, respectively.
