U.S. stock futures indicate a strong opening on Wall Street, as investor sentiment improves following the announcement of a trade agreement between the United States and Japan.
The deal has boosted confidence across global markets, lifting hopes for easing trade tensions and further economic cooperation.
US stock indexes climbed in premarket trading on Wednesday after President Donald Trump secured a trade agreement with Japan, raising hopes of further global deals.
The pact will reduce tariffs on Japanese car imports from 27.5% to 15%, while duties on other goods will drop from 25% to 15%. The news sparked optimism that negotiations with other major economies may follow.
Mr Trump also confirmed that EU representatives are heading to the negotiating table, fuelling speculation of a breakthrough with Europe. However, the EU is reportedly preparing countermeasures — including a potential 30% tariff on €100 million worth of US goods — should talks stall.
“Diminishing trade policy uncertainty is supporting risk assets,” said Elias Haddad of Brown Brothers Harriman. “However, steeper tariffs starting August 1 pose downside risks to US growth and upside risks to inflation.”
The S&P 500 notched its eighth record close this month on Tuesday, buoyed by easing trade tensions, strong economic data, and robust Q2 earnings.
Investors are now awaiting earnings from Tesla and Google parent Alphabet, due after markets close on Wednesday.
In premarket trade, the Dow Jones Industrial Average rose 0.5%, the S&P 500 added 0.4%, and the Nasdaq 100 was up 0.2%. Futures for the small-cap Russell 2000 index climbed 0.9%.
