Dow Jones rises 300 points after Trump says he'll meet with Xi
The Dow Jones is up as US President, Donald Trump, says trade talks with China's President, Xi Jinping, will resume.
The Dow Jones is surging after US President, Donald Trump, tweeted that he’ll meet with China's President, Xi Jinping, at the G20 Summit in Japan at the end of the month. Investors hope these talks will lead to an end to the US-China trade war.
Dow Jones jumps after Trump tweet about US-China talks
Trump wrote in a Twitter post that he recently talked to Xi. He also claimed that US and China trade representatives would resume talks to try to solve the US-China trade impasse.
‘Had a very good telephone conversation with President Xi of China. We will be having an extended meeting next week at the G20 in Japan. Our respective teams will begin talks prior to our meeting,’ tweeted Trump.
Michael Geraghty, equity strategist at Cornerstone Capital Group, said there is reason for cautious optimism, but warns that the US-China trade dispute may not be resolved soon.
‘Certainly, there’s ground for optimism. However, we have to remember there have been a lot of negotiations between China and the US where they seem to be close to a deal and then things fell apart,’ said Geraghty.
Dow Jones up as investors anticipate Fed rate cut
The Dow Jones is also rising as US Federal Reserve officials meet for the June Federal Open Market Committee (FOMC) meeting. Many investors are hoping that the meeting will lead Fed chair, Jerome Powell, to decrease interest rates in the summer.
Chris Zacarelli, chief investment officer at Independence Advisor Alliance, believes that the Dow Jones could tumble if the Fed doesn’t act to reduce interest rates and the US-China trade impasse isn’t resolved.
‘If the Fed doesn’t appear sufficiently dovish – including taking the word “patient” out of their statement – or the G20 meeting doesn’t result in significant progress in the trade war with China, then the market could experience a sharp pullback,’ noted Zacarelli.
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