Dow Jones recovers most of its losses after Trump trade tweets
Wall Street rebounds after a volatile day of trading.
Wall Street mostly recovered from a volatile day of trading. The Dow Jones had been down by as much as 400 points throughout the day.
Are the US-China talks still on?
US President, Donald Trump, tweeted about possibly imposing more tariffs on China after US trade representative, Robert Lighthizer, told him that China was withdrawing from trade talks. However, there were reports that Chinese Vice Premier, Liu He, was still going to Washington to meet with US representatives. An official from the Asian nation said that the trade negotiations could change based on how the US acts before the negotiations.
‘The atmosphere of the negotiations has changed. All that depends on the attitude of the United States,’ said the official.
Dan Clifton, Strategas Research’s head of policy strategy, said Trump’s threats could kickstart the US-China trade talks.
‘If this tactic is successful, the trade deal could be finished in the short run and this volatility would be an opportunity,’ said Clifton.
Jason Oxman, president of tech trade group Information Technology Industry Council, said that he was hopeful that the two nations could reach an agreement.
‘We are optimistic generally on reaching an agreement. We're optimistic that an agreement can be mutually beneficial,’ said Oxman.
How would Chinese import tariffs affect US businesses?
The Trump Administration has already imposed 10% tariffs on $200 billion worth of Chinese imports. Trump imposed to the tariffs to try to correct the trade imbalance between the US and China and claimed the tariffs would help American businesses.
However, economists from the US Federal Reserve Bank of New York said that the 2018 tariffs hurt US businesses and consumers that buy Chinese-made goods. Researchers found that ‘US producers responded to reduced import competition by raising their prices.’
Christin Fernandez, spokeswoman for the Retail Industry leaders Association, said that raising tariffs will hurt American consumers.
‘Raising tariffs means raising taxes on millions of American families,’ said Fernandez.
Investors will monitor the US-China trade negotiations to see if Trump's tweets and diplomatic negotiations will drive the countries to resolve their trade imbalance.
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