The session’s results indicate that the broad-based S&P 500 index rose 0.78%, reaching an unprecedented 6,358.91 points at the close, while the tech-heavy Nasdaq also achieved a record high at 21,020.02, with a gain of 0.61%. The Dow Jones Industrial Average, on the other hand, advanced 1.14% and came very close to its highest record.
“The new trade agreements concluded by the US with Tokyo, Manila, and Jakarta bolster confidence in the completion of other agreements before the August 1 deadline,” after which substantial increased tariffs are expected to be imposed by the US on several states, summarized Jose Torres of Interactive Brokers.
An essential US ally, “Japan will pay reciprocal tariffs of 15%,” announced Donald Trump on his social network on Tuesday, significantly lower than the 25% it would face without the agreement.
Japanese automotive companies listed in New York, such as Toyota and Honda, ended the session with significant gains, 13.64% and 13.13%, respectively.
The surcharges on Filipino products dropped from 20% to 19%, and regarding Indonesia, the agreement pertains to the framework for future bilateral negotiations aiming at a commitment.
“Investors are encouraged” by these announcements and remain optimistic, especially since “the European Union is moving towards a 15% tariff rate,” commented Pat Donlon of Fiduciary Trust Company in statements to AFP.
“Decisions” are underway in the trade discussions between Washington and Brussels, stated German Chancellor Friedrich Merz today, following Trump’s assurance the previous day that an agreement with Europe “will arrive tomorrow” (today).
Meanwhile, Chinese and American representatives are set to meet next week for a third round of negotiations.
After a hundred companies in the S&P 500 have already released their quarterly results, “nothing alarming has been seen yet,” noted Pat Donlon, which encourages the rise of stock prices.
“In the large-cap sector, companies assert that they can handle the (current) tariffs and modify their supply chains,” highlighted the analyst.
On the other hand, it will be “interesting” to observe the forecasts of consumer goods companies, “the most affected by tariffs,” due mainly to the relocation of production to Asia, anticipated Donlon.
