Japan’s benchmark Nikkei 225 rose sharply on Wednesday, after President Donald Trump finalized the long-anticipated trade deal between Washington and Tokyo.
As part of the $550 billion deal, Japan will open its markets to American cars, trucks, rice and other agricultural products, while agreeing to a 15% tariff on American imports from the nation.
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Both the Nikkei and Topix indices are up 3.10% and 2.71%, trading at 41,006.00 and 2,912.98, respectively, led by auto stocks. Mazda Motor Corp. (OTC:MZDAY) leads the way, up 17%, followed by Mitsubishi Motors Corp. (OTC:MSBHF) and Toyota Motor Corp. (NYSE:TM), up by 12.90% and 13.10%, respectively.
The Japanese Yen is down 0.17% against the U.S. Dollar on Wednesday, trading at 146.51, at the time of writing.
According to Spencer Hakimian of Tolou Capital Management, Japanese automakers like Toyota are surging on news of a 15% tariff, because they can now sidestep the tariff issues plaguing their American counterparts, such as those on steel, copper, and their regional production.
“Toyota only has to pay 15% more and they’re done with all the shenanigans,” he says, while adding that the U.S. has given Japanese automakers an advantage over local players, all in hopes of “bringing auto jobs back to America.”
U.S. stock futures are trading flat on Tuesday night, with S&P 500 futures up 0.06%, trading at 6,309.62, Nasdaq Futures down 0.39%, at 20,892.69 and Dow Futures at 44,502.44, up 0.40%.
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