Global Stocks Rally on Trade Deal Optimism – Asia Market Wrap

Global equities continued their rally as bulls drew fresh conviction from signs the US may strike more trade deals soon after clinching a pact with Japan.

A gauge of the world’s stocks hit a new record high, helped by a 1% gain in Asia. Japanese benchmarks jumped as much as 2%, fueled by the financial sector, while the yen rose as investors speculated the trade deal will make an interest-rate hike more likely. Nasdaq 100 contracts rose 0.3% after Alphabet Inc.’s earnings. Tesla Inc. shares dropped in after-hours on a weak forecast.

Futures for European stocks advanced 1.3% following reports the US was closing in on an agreement with the European Union that would set a 15% tariff for most products after the accord with Japan. The European Central Bank is expected to leave interest rates untouched for the first time in more than a year later Thursday.

The de-escalation in global trade tensions has reassured investors, easing fears of a prolonged trade war and fueling gains across global markets. Investors have bet that Washington would adopt a pragmatic approach before tariffs meaningfully impact corporate profits.

Trump suggested that he would not go below 15% as he sets so-called reciprocal tariff rates ahead of an August 1 deadline.