Wall Street opens with gains as US-UK finalize trade deal, tech stocks rally

Tech stocks also rallied on expectations of rolled-back AI chip curbs.

Wall Street saw optimism in early trade on Thursday, May 8, after U.S. President Donald Trump announced that the U.S. and U.K. have agreed on a trade deal.

At 7.20 pm IST or 9.50 am ET, the Dow Jones index was higher by 185 points or 0.45 percent, the tech-heavy Nasdaq index gained 100 points or 0.55 percent, while the broader S&P 500 index ticked up 25 points or 0.45 percent.

“The agreement with the United Kingdom is a full and comprehensive one that will cement the relationship between the United States and the United Kingdom for many years to come," said President Trump, in a post on Truth Social.

The U.S. President will reveal further details at 10 am ET. Trump also added that there are more deals, which are in serious stages of negotiation.

Tech stocks gained on Wednesday following reports that the Trump administration plans to roll back upcoming AI chip restrictions introduced under the Biden administration. The controls were set to take effect later this month.

Chipmakers led the rally, with Intel jumping 3.3 percent, AMD rising over 3 percent, and Nvidia edging up 0.5 percent. Among megacaps, Meta and Amazon gained more than 1 percent, while Tesla surged more than 3 percent.

In the previous session, Wall Street ended with gains, after a volatile session, marked by sharp swings from gains to losses. The volatility was sparked by Trump saying he wouldn't preemptively cut the tariff levied on China, amid the ongoing negotiations. Further, the US Federal Reserve left its benchmark lending rate unchanged, in the range of 4.25 to 4.5 percent.

According to U.S. Federal Reserve Chair, inflation in the U.S. may see an uptick, growth momentum could slow while unemployment rises, if U.S. President Donald Trump's broad-based tariffs are implemented.

Further, President Trump announced that he would not preemptively reduce tariffs on China to kickstart trade negotiations with Beijing. U.S. Treasury Secretary Scott Bessent along with officials would meet Chinese officials in Switzerland this week, signaling possible progress on trade talks after last month’s tariff turmoil. “We’ve got to deescalate before we move forward,” Treasury Secretary Scott Bessent said in an interview.

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