Background of the Trade Agreement
The US market experienced a strong upsurge on May 8, 2025, triggered by the announcement of a trade agreement between the USA and the UK. This development sent positive signals to investors and led to a rally on the stock exchanges.
The trade agreement, introduced by President Trump, includes several key points:
- Tariff Rate: The base tariff rate of 10% remains in place.
- Market Access: Access for American agricultural exports to the UK market will be improved.
- Vehicle Exports: Up to 100,000 vehicles manufactured in the UK can be imported into the USA at a reduced tariff rate of 27.5%.
- Revenue: The tariff is expected to generate revenues of $6 billion, as emphasized by Trade Minister Lutnick.
Impact on Markets
The announcement of this agreement had significant impacts on the markets:
- Stock Prices: The S&P 500 rose by 1.4% to 5,686 points, while the Dow Jones also increased by 1.4%, climbing over 500 points to 41,523 points. The Nasdaq led with a rise of 1.8%.
- Cryptocurrencies: Bitcoin surpassed the $100,000 mark for the first time since February, rising by up to 4% to $100,900. This increase was bolstered by the continued acceptance of cryptocurrencies by businesses and positive signals from the trade agreement.
Market Forecasts
The recent developments have the potential to further strengthen the recovery of the markets. The S&P 500 is in a consolidation phase but could continue to rise, especially if it reaches the resistance area around 5,773 to 5,783 points. However, a pullback could occur in the short term if the index falls below yesterday’s low.
Overall, the trade agreement sends positive signals to investors and could further support the recovery of the US markets.