NEW YORK (AP) — U.S. stocks set more records on Wednesday following a trade deal between the world’s No. 1 and No. 4 economies, one that would lower proposed tariffs on Japanese imports coming to the United States.
The S&P 500 added 0.8% to its all-time high. The Dow Jones Industrial Average rallied 507 points, or 1.1%, and the Nasdaq composite climbed 0.6% to hit its own record.
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Specialist Alex Weitzman works at his post on the floor of the New York Stock Exchange, Monday, July 21, 2025. (AP Photo/Richard Drew)
A person looks at an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
A currency trader watches monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Wednesday, July 23, 2025. (AP Photo/Ahn Young-joon)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
A currency trader watches monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top center left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Wednesday, July 23, 2025. (AP Photo/Ahn Young-joon)
A currency trader works near the screen showing news reporting with a picture of President Donald Trump at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Wednesday, July 23, 2025. (AP Photo/Ahn Young-joon)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
Stocks jumped even more in Tokyo, where the Nikkei 225 rallied 3.5% after President Donald Trump announced a trade framework that would place a 15% tax on imports coming from Japan. That’s lower than the 25% rate that Trump had earlier said would kick in on Aug. 1.
“It’s a sign of the times that markets would cheer 15% tariffs,” said Brian Jacobsen, chief economist at Annex Wealth Management. “A year ago, that level of tariffs would be shocking. Today, we breathe a sigh of relief.”
Trump has proposed stiff taxes on imports from around the world, which carry the double-edged risk of driving up inflation for U.S. households while slowing the economy. But many of Trump’s tariffs are currently on pause, giving time to reach deals with other countries that could lower the tax rates. Trump also announced a trade agreement with the Philippines on Tuesday.
So far, the U.S. economy has seemed to hold up OK despite the pressures on it. And tariffs already in place may be having less of an effect than expected, at least when it comes to the prices that U.S. households are paying at the moment.
“The main lesson about tariffs so far is that passthrough to consumer prices is tracking somewhat lower than in 2019,” according to Goldman Sachs economist David Mericle.
Tariffs are certainly having an effect, to be sure, as big U.S. companies across industries have been showing through their profit updates in recent days.
Hasbro took a $1 billion, non-cash hit to its results for the spring to write down the value of some of its assets following a review triggered by the implementation of tariffs. It said tariffs have had no impact yet on how much profit it’s making from each $1 of its sales, but it expects to see costs ramp during the current quarter.
Hasbro’s stock fell 0.9% even though it reported a stronger profit for the latest quarter than analysts expected, when not including the $1 billion charge.
Texas Instruments’ stock also fell despite delivering results for the latest quarter that were above analysts’ expectations. It gave a forecasted range for profit in the current quarter whose midpoint fell a bit shy of Wall Street’s.
Analysts pointed to some cautious commentary from Texas Instruments executives about how the uncertainty created by tariffs could slow demand. Its stock sank 13.3%.
Most of the stocks on Wall Street nevertheless rose, including a 14.6% jump for GE Vernova. The energy company not only delivered a stronger profit than analysts expected, it also raised its forecasts for revenue from its power and electrification businesses.
GE Vernova said that the inflation it’s expecting to see as a result of tariffs may be trending toward the lower end of $300 million to $400 million, net of mitigating actions.
Lamb Weston rallied 16.3% after the supplier of French fries and other potato products delivered better results for the latest quarter than analysts expected and said it expects customers will continue to eat fries even with an uncertain economy. It also announced a plan to cut at least $250 million in costs by cutting about 4% of its workforce and making other moves.
Elsewhere on Wall Street, several stocks jumped as traders search for the next “meme stock” that could ride a wave of online enthusiasm to high prices, regardless of what the company’s profits are doing. Krispy Kreme, which came into the day with a 58.4% loss for the year so far, jumped nearly 39% shortly after trading began. It then gave back most of it and ended with a gain of 4.6%. GoPro rose 12.4%.
That’s even as other potential meme stocks lost their momentum. Opendoor Technologies, which had more than tripled between the last two Mondays, fell 20.3%.
All told, the S&P 500 rose 49.29 points to 6,358.91. The Dow Jones Industrial Average jumped 507.85 to 45,010.29, and the Nasdaq composite gained 127.33 to 21,020.02.
In stock markets abroad, indexes rose across Asia and Europe following Trump’s announcements of trade deals.
Japan’s market was the big winner, where a series of automakers gave no public reaction as their stock prices rallied. Japanese companies tend to be cautious about their public reactions, and some business officials have privately remarked in off-record comments that they hesitate to say anything because Trump keeps changing his mind.
Elsewhere, Hong Kong’s Hang Seng rose 1.6%, and France’s CAC 40 gained 1.4% for two of the world’s bigger moves.
In the bond market, Treasury yields ticked higher.
The yield on the 10-year Treasury rose to 4.38% from 4.35% late Tuesday.
AP Business Writer Yuri Kageyama contributed.
Specialist Alex Weitzman works at his post on the floor of the New York Stock Exchange, Monday, July 21, 2025. (AP Photo/Richard Drew)
A person looks at an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
A currency trader watches monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Wednesday, July 23, 2025. (AP Photo/Ahn Young-joon)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
A currency trader watches monitors near a screen showing the Korea Composite Stock Price Index (KOSPI), top center left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Wednesday, July 23, 2025. (AP Photo/Ahn Young-joon)
A currency trader works near the screen showing news reporting with a picture of President Donald Trump at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Wednesday, July 23, 2025. (AP Photo/Ahn Young-joon)
A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Wednesday, July 23, 2025, in Tokyo. (Kyodo News via AP)
