Australian shares rose at Wednesday's close after President Donald Trump cut tariffs on Japanese imports to 15% from 25% under a new trade deal.

The S&P/ASX 200 Index rose 0.69% or 60 points to close at 8,737.2.

Japan will accept US-built vehicles without extra safety requirements, easing access for American automakers, Bloomberg reported.

"By accepting a diluted 15% tariff and pledging symbolic investment flows, Japan has offered a blueprint: concede just enough to defuse escalation without triggering deep structural reform," said Charu Chanana, chief investment strategist at Saxo Markets in Singapore.

On the domestic front, an indicator of Australian economic activity slowed further in June, weighed down by weaker commodity prices and soft domestic conditions amid subdued growth prospects, according to a report by Westpac and Melbourne Institute.

The Westpac-Melbourne Institute Leading Index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, fell to 0.03% in June from 0.1% in May.

In company news, Woodside Energy's (ASX:WDS) revenue rose 8% to AU$3.28 billion in the second quarter of the year compared with AU$3.04 billion in the same quarter a year ago. Shares of the company rose nearly 2% at market close.

Paladin Energy (ASX:PDN) said it expects to produce 4 million pounds to 4.4 million pounds of triuranium octoxide at the Langer Heinrich uranium mine in Namibia in fiscal 2026, while it expects triuranium octoxide sold during the period to be between 3.8 million pounds and 4.2 million pounds. Shares of the company fell 11% at market close.

Lastly, shares of Insurance Australia Group (ASX:IAG) rose 3% in recent trading on Wednesday after UBS upgraded the insurer to a "buy" recommendation with a target price of AU$9.40, according to a same-day report by The Australian.