Monday, 01 June, 2020

'Good Things Are Happening at China Trade Talk Meeting'

1 2019 a truck passes by China Shipping containers at the Port of Los Angeles 'Good Things Are Happening at China Trade Talk Meeting'
Deanna Wagner | 12 October, 2019, 16:51

US stocks ended more than 1% higher on Friday but well off the day's highs after the announcement, with the S&P 500 .SPX up 1.09% after rising as much as 1.7% earlier on hopes of an agreement.

Wall Street rose for the third straight session on Friday, with hopes running high that the talks between President Donald Trump and Chinese Vice Premier Liu He would culminate in a partial trade deal and delay planned US tariff increases.

Trump had said previously he would not be satisfied with a partial deal to resolve his effort to change China's trade, intellectual property and industrial policy practices, which he argues cost millions of

The Vice Premier thanked Trump for his congratulatory remarks about the Chinese government's anniversary and expressed optimism about the future talks between the two countries.

"Substantial progress had been made in such areas as agriculture, intellectual property rights protection, exchange rate, financial services, expansion of trade cooperation, technology transfer and dispute settlement", state-run Xinhua news agency reported citing Liu He, the country's top negotiator.

"This has been an irritant, I would say, for investors", said John Carey, a portfolio manager at Amundi Pioneer Asset Management. The gains helped the Dow and S&P 500 snap a three-week losing streak.

Chipmakers rose broadly. Micron Technology gained more than 5%, while Xilinx jumped 4.8%. In Hong Kong, the Hang Seng Index finished at 26308.44, up 600.51 or +2.34% and in South Korea, the KOSPI Index closed at 2044.61, up 16.46 or +0.81%.

"Actions speak louder than words", said David Madden, an analyst at CMC Markets U.K.

Hirson said the two sides ultimately may not get through to phase two.

However, some observers said the deal was underwhelming. USA consumer sentiment rose in early October, according to a University of MI survey released Friday.

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Companies have welcomed a U.S.

Tensions appeared to calm in Europe, too. That could include up to four waves of deals, according to the president.

"One of the great things about the China Deal is the fact that, for various reasons, we do not have to go through the very long and politically complex Congressional Approval Process", Trump wrote.

"The prospect of US-China trade truce that results in the suspension of further planned tariffs increases is rightly welcome news", Rodrigo Catril, a currency strategist at the National Australia Bank, said.

Meanwhile, the yen fell to its lowest level against the USA dollar since August, while gold prices dropped 0.8%.

Daco has estimated that the trade fight will cut USA growth by about 0.6 percentage point in 2020.

"There's been such a back and forth on trade", said John Porter, chief investment officer at Mellon Investments Corp. Details of other possible agreements weren't immediately released.

In commodity markets, crude oil prices gained after an Iranian tanker near the Saudi Arabian coast suffered damage Friday in what the ship's owner suggested may have been a missile attack.

Will Horner contributed to this article.