U.S. stocks rallied on Thursday as President Trump announced a major trade deal with the United Kingdom and showed optimism around future talks with China, fueling investor confidence and extending Wednesday’s rally.
By midday, the Dow Jones Industrial Average (DJI) was up 628 points, or 1.53%, while the S&P 500 (GSPC) gained 1.47%. The tech-heavy Nasdaq Composite (IXIC) led the charge, surging 1.92% as investors responded positively to easing trade tensions and the prospect of future economic stimulus.
Trump said the UK deal would significantly boost American exports and hinted that negotiations with China could lead to reduced tariffs, spurring hopes that the administration is pivoting away from its more aggressive trade stance.
Market Movers
- Boeing (BA) +4.27%: Shares rose after Commerce Secretary Howard Lutnick announced the UK will purchase $10 billion worth of Boeing aircraft as part of the new trade agreement. The news helped lift sentiment across the industrial sector, with investors betting on renewed international demand for U.S. manufacturing.
- Alphabet (GOOG) +2.44%: Alphabet rebounded after a sharp selloff on Wednesday triggered by concerns that Apple may introduce competing AI search tools. Analysts from major banks, including Jefferies and JPMorgan, defended the stock, calling the previous drop “overdone” and reiterating Buy ratings.
- Bitcoin (BTC-USD) +4.65%: Bitcoin broke through the $100,000 level for the first time since February, briefly trading at $100,500. The rally was partly fueled by optimism surrounding global trade deals, which have lifted overall investor sentiment and risk appetite across asset classes.
- Apple (AAPL): The stock held steady after sparking market jitters Wednesday over its reported interest in AI search engines. Though the news impacted Google’s stock yesterday, today’s rebound in Alphabet shares suggests investors are not yet pricing in a dramatic shakeup in search market dynamics.
Trade Optimism Shifts Market Tone
Thursday’s gains show a pivot in sentiment around trade policy, with Trump’s UK deal signaling a potentially less confrontational strategy moving forward. The president described the agreement as "very large" and highlighted expanded access for U.S. agricultural exports, steel, and autos. While a 10% tariff on UK imports remains, analysts see the reduction of tariffs on key sectors as a sign of progress.
Further bolstering optimism, Treasury Secretary Scott Bessent is expected to travel to Switzerland to meet with Chinese officials. Trump hinted that the current 145% tariffs on Chinese imports could come down depending on how talks go — a major shift from his prior hardline stance.
Fed Holds Steady as Trump Attacks
Amid the market rally, the Federal Reserve's decision to leave interest rates unchanged added another layer of support for equities. Fed Chair Jerome Powell emphasized a cautious "wait-and-see" approach, citing economic uncertainty largely driven by tariff tensions.
However, Trump continued his criticism of the central bank, calling Powell a "fool" and saying he "doesn’t have a clue." While such remarks typically add volatility, markets appeared to shrug off the rhetoric, focusing instead on positive developments on trade and deregulation.
Looking Ahead
With investor sentiment rebounding on trade news and hopes for deregulation and tax cuts, the focus now shifts to whether Trump's promises will materialize into further concrete policy moves. Markets will closely watch Bessent’s China trip for signs of thawing tensions and any potential tariff relief. At the same time, analysts caution that volatility may return quickly if talks falter or if the Fed signals a change in tone. For now, though, bulls are firmly in control.
