If the trade war updates have slipped past you, the recent stock market movements might have given you the impression that it’s coming to an end.
With trade negotiations between the world’s major economies throwing uncertainty into the global trade arena, stocks are gaining momentum amidst growing optimism for a resolution to the trade conflict.
The S&P 500 index is reaching close to its peak levels, and the Dow Jones is on course for its strongest performance since January. Data from Markets Insider reveals that investors have been pumping funds into US stocks at the highest rate in over a year, indicating that their concerns might not be accurately reflected in the market. Although the trade war is far from being resolved, equity strategists are cautiously optimistic.
On the Chinese front, President Xi Jinping has outlined a set of conditions that need to be addressed for the trade war to reach a settlement. These conditions are expected to be presented at the upcoming G20 summit. One of the key demands is for US President Donald Trump to revoke the current restrictions on American technology sales to the Chinese tech giant Huawei. Additionally, Xi will emphasize the elimination of tariffs on Chinese imports. While the specifics are yet to be clarified, Xi is likely to negotiate more rational terms for China’s purchase of American goods. As a gesture, China may offer strategic support on issues concerning Iran and North Korea. However, Beijing’s willingness to go beyond this is limited as internal pressure mounts on Xi to counter American allegations of trade irregularities, intellectual property infringement, and espionage.
Despite the positive stock market trends, the political landscape remains far from settled. Investors poured $14 billion into US stocks last week, marking the highest investment influx since March 2018.
