US stocks opened higher on Thursday as Beijing and Washington agreed to roll back tariffs on each other’s goods as part of an effort to secure a phase-one trade deal.
As of 1530 BST, the Dow Jones Industrial Average was up 0.77% at 27,704.32, while the S&P 500 was trading 0.59% stronger at 3,094.84 and the Nasdaq Composite started out the session 0.69% firmer at 8,468.58.
“In the past two weeks, top negotiators had serious, constructive discussions and agreed to remove the additional tariffs in phases as progress is made on the agreement,” China’s Ministry of Commerce spokesman Gao Feng said Thursday.
White House economic adviser Larry Kudlow later Thursday confirmed the advance in negotiations. “If there’s a phase one trade deal, there are going to be tariff agreements and concessions,” he told Bloomberg.
Kellyanne Conway, the senior White House adviser, also said Thursday President Donald Trump is “anxious” to sign the deal. The negotiations are ongoing and a time or place for any signing of a pact is yet to be determined.
However, White House trade adviser Peter Navarro told Fox Business: “there is no agreement at this time to remove any of the existing tariffs as a condition of the phase one deal. The only person who can make that decision is President Donald J. Trump. It’s as simple as that.”
An agreement to ratchet back tariffs would pave the way for a de-escalation in the trade war that’s cast a shadow over the world economy. China’s key demand since the start of negotiations has been the removal of punitive tariffs imposed by Trump, which by now applies to the majority of its exports to the U.S.
“If China, U.S. reach a phase-one deal, both sides should roll back existing additional tariffs in the same proportion simultaneously based on the content of the agreement, which is an important condition for reaching the agreement,” Gao said Thursday.
Asian stocks were mixed Friday and U.S. equity futures edged lower as the risk-on mood that’s permeated global financial markets this week showed signs of abating.
China’s exports and imports continued to contract in October, data released Friday showed, though slightly less than forecast by economists. The trade surplus with the U.S. widened in the month to $26.4 billion.
U.S. locations for a Trump-Xi meeting that had been proposed by the White House, including Iowa and Alaska, have been ruled out, according to a person familiar with the matter. Locations in Asia and Europe are now being considered instead, the person said, asking not to be identified because the discussions aren’t public.
In another move, China’s General Administration of Customs and Ministry of Agriculture are studying the removal of curbs on U.S. poultry imports, Xinhua reported, without providing more details.
Trump administration officials in recent days have expressed optimism that phase one of a comprehensive trade deal might come together this month, helping boost equity markets to records this week.
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