On June 22, Dow climbed by 153 points, a 0.6% increase to the level of 26,024.96. In the pre-market today, Dow futures are 309 points up.
Some good news from the U.S.-China front is showing some positive effects on the American financial market. Stock futures have recently begun to regain some of the weight it shed because of the coronavirus pandemic. While most are still on a recovery journey, Dow futures are shooting higher after the White House announced that the ongoing deal with China is unaffected by recent events.
According to a recent statement, White House trade advisor Peter Navarro has revealed that the recently agreed first phase of the China-U.S. deal, is still on. Navarro says that earlier remarks he made may have been misunderstood:
“My comments have been taken wildly out of context. They had nothing at all to do with the Phase 1 trade deal, which continues in place.”
Dow Futures Rise On China Deal
Navarro’s explanation seems to be clarifying earlier comments made during a Fox News interview, with Martha MacCallum. MacCallum asked Navarro if the trade deal with China was over, suggesting China’s suspected involvement in the coronavirus pandemic. The trade advisor answered in the affirmative. After the interview, the Dow futures lost nearly 400 points.
Explaining further Navarro says:
“I was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world.”
In response to the above pronouncement, stock figures began to post gains. Futures on the Dow Jones Industrial Average (DIJA) climbed 190 points, showing an opening jump of nearly 246 points. Similar increases were also seen in futures on both Nasdaq and the S&P 500.
In a recent tweet, U.S. President Donald Trump also corroborated Navarro’s confirmation of the deal. For a long time, trade tensions between China and the U.S. threatened commerce in both countries. In the heat of the conflict, both countries levied millions of dollars in tariffs, as each one sought dominance over the other.
The China Trade Deal is fully intact. Hopefully they will continue to live up to the terms of the Agreement!
— Donald J. Trump (@realDonaldTrump) June 23, 2020
Dow and Other Indexes
On June 22, the Dow climbed by 153 points, a 0.6% increase to its current 26,024.96. In the pre-market today, Dow futures are 309 points up. The S&P 500 also showed gains of 0.7%, adding 20.12 points to 3,117.86. The Nasdaq however rose higher than both indexes, increasing by 1%.
Speaking to CNBC, Leuthold Group’s chief investment strategist, Jim Paulsen, expressed some optimism. According to him, the possibility of a near-future spike in the number of confirmed COVID-19 cases is not strong enough to make investors dour. Paulsen believes that “the virus and the bull market can coexist.”
Even with the optimism, the COVID-19 specifics in the country are all but encouraging. On June 21, the U.S. recorded over 36,000 new cases. This development points to a second wave of the pandemic, as several states are slowly relaxing lockdown enforcements. While this might seem grim, many are of the opinion that these numbers might simply reflect a significant increase in testing, and not exactly that the pandemic is worsening.