By Dow Jones Newswires Staff

Trade optimism drove global stock markets higher Wednesday after the U.S. struck agreements with Japan, the Philippines and Indonesia. For Japan in particular, the lowering of tariffs on carmakers to 15% from their current 25% provided a big boost to a core industry and powered a global jump in auto-sector stocks. Meanwhile, U.S. Treasury Secretary Scott Bessent said on Fox Business on Tuesday that he would be meeting Chinese officials to extend the two countries' trade truce, which expires Aug. 12.

It's a big day for earnings, with Alphabet and Tesla set to report, as also IBM and AT&T.

--Japan's Nikkei Stock Average closed up 3.5% higher, marking the biggest gain in a year. The gains were broad-based, with automobile stocks rising the most. South Korea's Kospi closed 0.4% higher, also boosted by auto stocks.

--European stocks opened higher, tracking the gains in Asia. The pan-European Stoxx Europe 600 was up 1% shortly after the open. Car companies were among the top gainers; Sweden's Volvo Car climbed more than 10%, Porsche added 6.9%, Stellantis gained 5.5% and Volkswagen was up 5%. The U.K.'s FTSE 100 moved 0.4% higher, having closed at a record level Tuesday.

--U.S. stock futures for the S&P 500 and Dow Jones Industrial Average were up 0.3% and Nasdaq futures rose 0.1%.

--The dollar edged higher against a basket of major currencies, with the DXY dollar index up 0.1% to 97.488.

--Still, sovereign bond markets were flashing some warning signs despite the trade optimism. A weak 40-year Japanese government bond auction drove JGB yields higher; the 40-year JGB yield rose 8.6 basis points to 3.459%, according to LSEG. The 10-year Treasury yield rose almost 4 basis points to last trade at 4.373%, and the 10-year U.K. government bond yield also climbed 4 basis points.

--Oil prices nudged up, with Brent crude and WTI both 0.1% higher. Prices remain generally subdued on persistent concerns over tariffs and potential oversupply. Both benchmarks are down around 8% in the year-to-date.

Write to Barcelona Editors at barcelonaeditors@dowjones.com

(END) Dow Jones Newswires

July 23, 2025 04:17 ET (08:17 GMT)

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