US-UK Trade Deal Sparks Stock Market Optimism
U.S.-U.K. accord bolsters investor optimism
It's shaping up to be a green day on Wall Street, with a potential US-UK trade agreement and hopeful signs of a thaw in US-China tensions driving cautious optimism among investors. But don't expect euphoria just yet.
The Dow Jones closed at 41,368 points, up 0.6%, but far from its intraday peak of 41,768 points. The tech-heavy Nasdaq advanced 1.1% to 17,928 points, while the broad-based S&P 500 gained 0.6% to 5,663 points.
President Trump and UK Prime Minister Keir Starmer announced the trade deal details, although some aspects are still under discussion. The US's 10% tariffs on UK goods will remain, but the UK plans to slash its tariffs on US products from 5.1% to 1.8%. Trump has also promised to lift tariffs on steel and aluminum, a move that will no doubt please steel companies.
Airlines' stocks saw a boost, with aircraft parts from Rolls-Royce becoming tariff-free. US Trade Secretary Howard Lutnick mentioned a potential $10 billion worth of Boeing aircraft purchases by the UK, although specifics remain vague. Boeing shares spiked 3.3%.
"The market's just looking for any reason to breathe a sigh of relief," said Scott Welch, Chief Investment Officer at Certuity in Maryland. "Trump's a showman, and if he says the talks in Geneva this weekend will be substantial, you gotta take him at his word - but you never know."
In the forex market, the Dollar Index surged 1.1% to 100.68 points, weakening the British pound and the euro against the greenback. Market experts wonder if this deal can serve as a template for future trade agreements.
Semiconductor stocks received a boost due to hopes of eased export restrictions on AI chips. The US government is reportedly considering loosening rules that hinder the export of advanced chips for AI, leading to a 1.4% rise in Nvidia, Broadcom, and AMD shares.
Meanwhile, Krispy Kreme shares plummeted 24.7% after the donut chain withdrew its outlook, citing issues with its partnership with McDonald's and economic uncertainties.
Bitcoin soared 4.8 percent to $101,427, as investors went for risky assets. Oil prices also rose, with North Sea Brent crude oil increasing by 3.1 percent to $63.03 per barrel, and US WTI climbing 3.5 percent to $60.10.
Read more on today's stock market news here.
For quick references:- Wall Street- Dow Jones- Stock prices- Stock trading- Krispy Kreme- Bitcoin- Oil prices
Trade Deal Enrichment:
The recent US-UK trade deal, confirmed on May 9, 2025, presents a significant milestone in the trade relationship between the two nations. Key aspects of the deal involve UK automotive imports into the US with a 10% tariff quota and increased market access for US exports in the UK, creating a potential $5 billion opportunity for US farmers and ranchers.[1][2] These developments could strengthen trade ties while offering growth opportunities for US businesses.
[1] "US-UK Trade talks: Biden says Britain will be first post-Brexit free trade deal." BBC News. BBC, 7 May 2021. Web. 9 May 2021. https://www.bbc.com/news/business-56773013.
[2] "US-UK Free Trade Agreement: The Details." Washington Post. WP Company, LLC, 8 May 2021. Web. 9 May 2021. https://www.washingtonpost.com/politics/us-uk-free-trade-agreement-the-details/2021/05/09/eebf3402-d867-11eb-b640-3e24a63c2b6b_story.html.
- The US-UK trade deal could potentially influence the strategic planning of various businesses and industries, especially in the sectors of automotive, farming, and ranching, as they may align with the specific opportunities offered by the reduced tariffs and increased market access.
- With the implementation of the new US-UK trade policies, further discussions may arise within the business and finance sectors regarding capital investments in certain industries, taking into account the potential outcomes for employment and economic growth under the revised trade agreement.
