After some positive developments in the phase 1 of the US-China trade deal, the U.S. stock market saw some surge.
The eyes of the world are currently on the United States and China, as the trade deal negotiations between the two economic powerhouses are taking new turns. Over the last two years, both countries have shown restraint in coming to a mutual consensus. However, there was a renewed optimism in the market after last Friday’s positive results in the trade talks.
After the U.S. suspended its next tariff increase on Chinese imports, the U.S. stock market saw a major rally on Friday. The Dow Jones index jumped 300 points in a single session. However, this is just a partial deal at this stage, which covers currency, agriculture and some intellectual property protections.
President Trump said that the first phase of the deal is through. However, he adds that a lot of work still needs to be done by both sides. Chinese journalist Hu Xijin, also the editor-in-chief of Global Times, said:
“Initial wave of comments in Chinese media all stresses rationality and calmness. Official reports didn’t mention that President Trump hopes to sign the deal next month. This shows Beijing’s concern over uncertainty and doesn’t want to raise expectations of the public.”
As stated the deal is a two-stage deal. Phase one of the deal has been negotiated as U.S. President said that phase two will happen “almost immediately” after phase-one paper-work is over. President Trump said:
“We’ve also made very good progress on technology transfer and we put some of technology transfer in phase one, phase two will start negotiations almost immediately after we’ve concluded phase one and papered it and I think phase one should happen pretty quickly.”
As the phase 2 stage of the trade deal is yet to go through, the Chinese media has expressed caution. It says that it would be too early to celebrate and refrains from raising any public expectations.
But it also notes that the ending of these tough times will be a booster to both the economies. Tennessee Republican Senator Marsha Blackburn said that the phase 1 of the deal last week, has lifted significant pressure from the agriculture industry. She added that it remains to be seen if the manufacturing sector can enjoy the same perks.
In the recent interview, the senator also noted the progress that is now being observed by many experts ad parties involved and said that many retailers in Tennessee have hopes that soon the situation will be improved.
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