Stocks Open Higher as Trade Hopes and Strong Earnings Lift Sentiment

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U.S. stocks opened in positive territory Wednesday as investors weighed upbeat corporate earnings against persistent trade tensions, while a signal from President Donald Trump about ongoing talks with European leaders bolstered hopes for a potential deal.

The Dow Jones Industrial Average rose 213.65 points, or 0.48%, to 44,672.3 shortly after the opening bell. The S&P 500 gained 22.92 points, or 0.36%, to 4,668.68, while the Nasdaq Composite advanced **98.93 points, or 0.46%, to 21,780.8.

Market optimism was supported by a morning post from Mr. Trump stating, “Will be speaking to European Leaders in a short while. They are great people who want to see a deal done.” The message comes against the backdrop of tariffs at their highest levels since 1933, a policy shift that has fueled both market volatility and sector-specific gains in recent months.

A recent J.P. Morgan analysis suggested that fears of “irrational exuberance” are misplaced, despite the S&P 500’s nearly 30% surge since April lows. Corporate earnings have significantly outpaced forecasts, with companies in the index tracking toward 11% growth compared with expectations of less than 5% heading into the season. Technology, financials, and utilities are seen as best positioned to extend gains, supported by artificial intelligence investments, deregulation, and rising infrastructure demand.

Economic data from the Bank of America Institute painted a mixed picture for consumer activity. July card spending rose 1.8% year-over-year—the strongest since January—driven by online retail promotions and a late surge in back-to-school purchases. However, analysts noted these were largely temporary drivers, and a widening gap in wage growth between higher- and lower-income households may temper broader spending momentum.

The resilience in equities has come despite tighter trade conditions. While tariffs on imported goods have reached historic highs, selective exemptions, such as for certain Apple products from India, and generous fiscal measures like the One Big Beautiful Bill Act, which offers 100% bonus depreciation for qualified property, have eased pressure on large-cap companies.

Investors will be watching closely for any concrete developments from the President’s talks with European leaders, as well as economic data later in the week that could influence Federal Reserve policy expectations. Current market pricing implies a 95% chance of a 25-basis-point rate cut in September, according to J.P. Morgan.

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