Dow up 0.84%, S&P 500 0.44% as Trump's trade deals and AI plan boost U.S. stocks

U.S. stocks surged on July 23 as the Dow Jones Industrial Average and S&P 500 rose following President Donald Trump’s announcement of trade agreements and an artificial intelligence (AI) strategy. The Dow climbed 370 points, or 0.84%, while the S&P 500 gained 0.44%, with optimism fueled by a U.S.-Japan trade deal and progress toward an EU agreement. The Nasdaq, however, saw a more modest 0.14% increase [1].

The U.S.-Japan agreement, reached after months of negotiations, imposes a 15% tariff on Japanese goods imported to the U.S., significantly lower than the 25% previously threatened by Trump. The deal includes reciprocal terms, allowing Japan to open its market to U.S. products such as cars, trucks, and rice. Analysts attributed the market rally to reduced trade tensions and the potential for further agreements, including a reported 15% tariff framework in U.S.-EU negotiations targeting sectors like medical devices and aircraft [1].

Trump’s AI “action plan” further bolstered investor sentiment, diverging from Joe Biden’s export restrictions on advanced AI chips. The new policy focuses on curbing AI models with “ideological biases” embedded by developers, a shift that could impact companies like Elon Musk’s Grok, which has faced criticism for controversial outputs. The plan emphasizes regulatory clarity and infrastructure investment, positioning the U.S. to compete globally in AI development [1].

Market movements reflected confidence in Trump’s policy direction. Earlier in July, the Dow had surged over 400 points on July 9, and the S&P 500 reached record highs on July 2 and July 20, even as earnings reports remained mixed [2]. Analysts noted that the rally was driven by a combination of trade progress and AI-related policy clarity, though they cautioned about execution risks, including the timeline for EU negotiations and regulatory reforms [8].

The U.S.-Japan deal followed earlier tensions, including the EU’s €100 billion no-deal plan targeting aircraft and whiskey, and Trump’s 30% tariff threats. The reported EU agreement, if finalized, would eliminate tariffs on specific products, easing trade pressures that had previously weighed on markets [1].

While the immediate outlook appeared positive, challenges such as fluctuating crude prices and mixed earnings reports added complexity. Nonetheless, Trump’s economic team highlighted job growth and tariff success as underpinnings for the market’s resilience, with major indexes shrugging off trade uncertainties [6].

The July rallies demonstrated that Trump’s trade and tech policies had recalibrated investor expectations. With further clarity on AI frameworks and potential expanded agreements, markets remained positioned for upward momentum in the near term [10].

Sources:

[1] [Dow Jones up 400 points after Trump inks trade deal, AI plan](https://crypto.news/dow-jones-up-400-points-trump-trade-unveils-ai-plan/)

[2] [Dow, S&P 500, Nasdaq futures rise after US strikes a trade deal](https://finance.yahoo.com/news/live/stock-market-today-dow-sp-500-nasdaq-futures-climb-as-trump-announces-trade-deal-with-japan-232647094.html)

[6] [Trump's economic team sees job growth and tariff success](https://www.foxbusiness.com/politics/trumps-economic-team-sees-job-growth-tariff-success-amid-fed-feud)

[8] [Wall Street indexes end split amid mixed earnings, crude slides as trade deadline looms](http://www.msn.com/en-us/news/other/wall-street-indexes-end-split-amid-mixed-earnings-crude-slides-as-trade-deadline-looms/ar-AA1J5SMQ)

[10] [Wall Street climbs on US-Japan trade deal, hopes for more agreements](https://www.investing.com/news/economy-news/wall-street-futures-lifted-by-usjapan-trade-deal-4147638)