U.S. Stock Futures Jump as Mexico Strikes Deal to Avert Tariffs

U.S. stock-index futures rose after President Donald Trump announced late Friday that he would drop plans for tariffs on Mexico. S&P 500 Index contracts rose 0.5% as of 8:49 a.m. in Tokyo after Trump said that plans for a 5% tariff on Mexican goods had been “indefinitely suspended.” Dow Jones Industrial Average contracts advanced 0.4%, while those on the Nasdaq 100 added 0.5%. A retreat from haven assets weighed on the Japanese yen and the Swiss franc. “The news of the deal with Mexico is likely to power global equities higher,” said Ben Emons, managing director for global macro strategy at Medley Global Advisors. “Averting tariffs on Mexican goods is a relief for the U.S. economy because it reduces uncertainty. It is positive for auto companies and other corporations that are highly leveraged to the Mexican border supply chain.” U.S. stocks rallied for a fourth day on Friday amid speculation the Federal Reserve will move to cut interest rates to shore up the economy after a report showed employers added the fewest workers in three months and wage gains cooled. “If there is one constant that keeps the S&P ticking, it’s the Federal Reserve cheap money,” Stephen Innes, head of trading and market strategy at SPI Asset Management, wrote in a note on Sunday.