The stock market jumped after former President Donald Trump made a major trade deal with the United Kingdom. This is the first international agreement since he began his new global trade push last month. Right after the news, the Dow Jones Industrial Average went up by more than 500 points. The deal was made between Trump and UK Prime Minister Keir Starmer and includes a large multi-billion dollar tariff agreement.
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Trump said that the United States will earn $6 billion through a 10 percent tariff on UK imports. In addition, American farmers and ranchers are expected to gain over $5 billion in new export opportunities. During the announcement at the Oval Office, Commerce Secretary Howard Lutnick said the UK agreed to buy $10 billion worth of Boeing airplanes. He also mentioned that Trump agreed to allow the UK to export 100,000 cars to the U.S. with just a 10 percent tariff. This will help support thousands of jobs in the UK’s car industry.
“This would’ve taken us 3 years — Trump got it done in 45 days,” Lutnick said. “Trump gets deals done.” The deal also benefits Keir Starmer politically, as he had been working quietly on the agreement for weeks. He didn’t travel to Washington for the announcement but held a press conference in the UK’s West Midlands and joined the Oval Office event by phone.
Trump called the agreement a win for both countries. “This is now turning out to be a really great deal for both countries,” he said. He also said this would be the first of many future trade deals. Last month, his new “Liberation Day” tariffs caused major disruptions in the global economy.
Investors reacted quickly, and Wall Street began to rise as soon as the details were shared. “This morning I’m thrilled to announce that we have reached a breakthrough trade deal with the United Kingdom – incredible country,” Trump said in the Oval Office. “Today is a Victory Day for World War II – we won the war together exactly 80 years ago so there could be no more perfect morning to reach this historic agreement.”
Trump hinted that more deals are coming soon. “Today’s agreement with the UK is the first in a series of agreements on trade that my administration has been negotiating for the past four weeks,” he said. He explained that the deal includes $6 billion in revenue through tariffs. It also helps national security by strengthening the medical supply chain and creating a new trading zone for aluminum and steel.
Lutnick added that opening the UK market could bring $5 billion in new business for American exports, especially in steel, agriculture, and the auto sector. When asked about British films, Trump said the tariff situation was still being worked out. “James Bond has nothing to worry about,” he said, referring to the UK sending 100,000 cars to the U.S., which could help companies like Aston Martin.
Trump added, “Sean Connery was a friend of mine.” He said the actor helped him with permits for his golf course in Aberdeen, Scotland. After the announcement, Trump posted on Truth Social: “This Deal shows that if you respect America, and bring serious proposals to the table, America is OPEN FOR BUSINESS. Many more to come — STAY TUNED!”
Lutnick repeated that the UK opening its market will create $5 billion in new export opportunities for American cars, car parts, agriculture, and steel. A UK official said earlier in the week that the countries had made good progress on lowering tariff limits for steel and cars. Starmer has been trying to finish this agreement before a big Brexit-related meeting with the European Union on May 19. Earlier this week, he also completed a separate trade deal with India.
Trump wrote on Truth Social that the UK deal is “a full and comprehensive one that will cement the relationship between the United States and the United Kingdom for many years to come.” He added: “It is a great honor to have the United Kingdom as our FIRST announcement. Many other deals… to follow!”
U.S. stock futures rose overnight but dropped slightly after Trump’s announcement around 6:30 a.m. However, the stock market still opened higher after a tough month of volatility. Trump’s trade team has been busy since April 2, when he imposed a 10 percent tariff on many countries. He also added bigger tariffs for specific trade partners but delayed those increases for 90 days due to the global reaction and a market crash.
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The UK was not hit with extra tariffs, because it buys more from the U.S. than it sells. Trump has imposed heavy tariffs elsewhere: 25 percent on cars, steel, and aluminum, plus 25 percent on all imports from Canada and Mexico, and an enormous 145 percent tariff on Chinese goods, making it hard for China to do business with the U.S.
Trump said he would be reviewing more potential trade deals over the next two weeks. Last week, he mentioned possible agreements with India, South Korea, and Japan. He had also discussed a U.S.-Europe trade deal when Starmer visited the White House in February, before the “Liberation Day” tariffs were introduced.
There’s still uncertainty about whether the UK will get an exemption from the 10 percent base tariff. Starmer has rejected some of the U.S. demands in the talks. Trump also said he might consider removing tariffs on some baby products like car seats and diapers to help parents save money. These items are mostly made in China and have become more expensive due to high tariffs.
When asked about this, Trump replied: “I don’t know. I’ll think about it.” He added: “I want to make it nice and simple… We have to make it very simple but I’ll take a look at it.” These comments came as markets looked ahead to U.S.-China trade talks scheduled for Saturday. These talks could be a first step toward solving the growing trade tensions between the two largest economies in the world.
