TOKYO/SEOUL (Reuters) -Shares of Japanese, South Korean and European automakers surged on Wednesday after U.S. President Donald Trump agreed to a trade deal with Tokyo that included reducing tariffs on Japanese auto imports to 15%, a move that stoked optimism about a similar agreement for Seoul and Brussels.

The 15% tax is a meaningful drop from the 25% rate that Trump, in a recent letter to Japanese Prime Minister Shigeru Ishiba, said would be levied starting Aug. 1.

Japan's chief tariff negotiator Ryosei Akazawa speaks to the media after a meeting between Prime Minister Shigeru Ishiba and Treasury Secretary Scott Bessent in Tokyo, on July 18, 2025. Shuji Kajiyama/AP

The trade deal with Japan is also giving investors hope that there could be similar reductions on tariffs for vehicles imported from other countries—including trade agreements that would benefit U.S.

President Donald Trump is bragging that Japan has given him, as part of a new trade framework, $550 billion to invest in the United States.

Stock futures are higher Wednesday as investors welcome news that the U.S. reached a trade agreement with Japan and prepare for the release of quarterly results from major technology companies.