Wall St extends gains after report of US-EU nearing trade deal

NEW YORK: Wall Street’s main indexes moved higher on Wednesday after a Financial Times reported that the EU and the United States were closing in on a trade deal, similar to the agreement US President Donald Trump struck with Japan.

Wall Street, already on an upward trajectory, spiked after the report said that the US and the EU are nearing a deal to set 15% tariffs on all European imports.

Both sides would waive tariffs on some products, including aircraft, spirits and medical devices, the report said.

The bullish momentum followed closely on the heels of Trump’s

trade deal with Japan, which will slash tariffs on Japanese autos to 15% from 27.5%, with duties on other goods also dropping to 15% from 25%.

An agreement with the Philippines also followed, which yielded a modest cut in tariff rate.

At 12:20 p.m. ET, the S&P 500 gained 31.08 points, or 0.49%, to 6,340.70 and the Nasdaq Composite rose 43.28 points, or 0.21%, to 20,935.97.

The Dow Jones Industrial Average edged higher 417.80 points, or 0.93%, to 44,917.71, within striking distance of its record peak.

Wall Street’s “fear gauge”, the CBOE Volatility Index , dipped to its lowest level in over five months.

Earlier in the day, the European Commission was preparing to seek approval for 93 billion euros ($109 billion) in counter-tariffs on American goods just in case the talks fell through.

“The key thing is the markets have confidence that the White House is going to continue to work through these trade deals,” said Larry Tentarelli, chief technical strategist for Blue Chip Daily Trend Report.

Investors are now laser-focused on earnings from the “Magnificent Seven” — a group of marquee names that has helped propel US stocks to all-time highs.

EV maker Tesla and Google-parent Alphabet are set to report after the bell on Wednesday. With AI optimism running high and valuations stretched, expectations for these tech giants are sky-high, leaving little margin for disappointment.

Shares of Tesla were largely steady, while Alphabet moved 0.9% lower.

GE Vernova’s shares climbed 14.1% to an all-time high, as the power equipment maker raised its current-year revenue and free cash flow forecasts after beating Wall Street estimates for second-quarter profit.

The stock, which has gained about 91% so far this year, boosted the S&P’s industrials index for the day, up 1.6%. Medical equipment maker Thermo Fisher surged 11.8% after beating Wall Street’s estimates for second-quarter profit and revenue.

Of the 117 companies in the S&P 500 that have reported earnings to date, 84.6% have reported above analysts’ expectations, as per data compiled by LSEG I/B/E/S.