Trump Strikes a Trade Deal With the EU. The U.S. Meets With China Next.

President Donald Trump announced an EU trade deal during a golf trip to Scotland. (Getty Images)

President Donald Trump’s trade deal with the European Union is giving investors what they needed: a semblance of certainty.

With coming U.S. tariff rates looking more secure, futures for the S&P 500 were rising and the Europe STOXX 600 rose to within 1.6% of the record high reached in March, Dow Jones market data showed.

White House officials are meeting Chinese officials in Stockholm this week to hammer out more details for a framework between the world’s two largest economies. A pact with India, which Trump hinted last week was close to getting done, could also be announced before the Aug. 1 deadline on Friday, when tax rates on imports are set to go up if no deal is reached.

The EU deal—announced as Trump traveled to Turnberry, Scotland, on a golf retreat—reinforced the idea that the general baseline for tariffs is now 15%, as long as other countries don’t retaliate by raising their levies. That’s the level Japan and EU are at, but that doesn’t include additional levies on certain sectors such as steel and aluminum.

“The agreement can hardly be termed a great deal for the EU,” wrote analysts led by Cedric Gemehl at Gavekal Research. “But by removing from the picture the worst case scenario of 30% U.S. tariffs, EU retaliation and an escalating bilateral trade war, and by greatly reducing uncertainty, Turnberry eliminates the major near-term headwind.”

Audi, the luxury German car brand owned by Volkswagen , lowered its full-year guidance on Monday, saying tariffs and structuring costs would eat into profits. Heineken , the Dutch beer brewer, welcomed the EU-U.S. deal and kept its outlook unchanged, but also said tariffs had increased its costs.

Write to Brian Swint at brian.swint@barrons.com