US stocks recovered on Tuesday following the publication of a report that Washington and Beijing are seeking to de-escalate the trade spat that could rock the global economy.
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All the three key US indices – the Nasdaq, Dow Jones and S&P – were trading in the green zone, all growing just shy of one percent. This happens as US Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He hold private talks on ways to restart negotiations, Bloomberg reported. Mnuchin told CNBC last week that “there continue to be some quiet conversations” regarding China.
“It’s a technical reaction, as technology stocks have sold off quite sharply,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York, as quoted by Reuters. Both the S&P 500 and Nasdaq came into Tuesday’s session with three-day losing streaks. “If you have several days of declines, you have some bargain hunting coming in and that’s what is temporarily halting the fall.”
US tariffs of 25 percent on $ 34 billion of Chinese imports took effect on July 6. The Chinese government retaliated with duties on the same value of US imports, ranging from soybeans to cars, and has vowed to respond proportionately to any new US tariffs.
Shortly after that, President Donald Trump said the US could impose tariffs on more than $ 500 billion worth of Chinese goods, while his administration has prepared a new $ 200 billion list of Chinese products that could be levied with 10 percent tariffs.
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