Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  Indexes  >  USA  >  S&P 500    SP500

S&P 500

(SP500)
Real-time Estimate Quote. Real-time Estimate TTMzero - 07/14 09:19:59 pm
3170.37 PTS   +0.48%
03:17pVirus worries and FOMO drive options bets on surging tech giants
RE
03:16pNEWS HIGHLIGHTS : Top Company News of the Day
DJ
03:16pNEWS HIGHLIGHTS : Top Global Markets News of the Day
DJ
SummaryQuotesChartsNewsHeatmapComponents 
News SummaryAll newsNews of the index componentsMarketScreener Strategies

'Lemon' or not, Trump stuck with Phase 1 China trade deal for now

share with twitter share with LinkedIn share with facebook
06/01/2020 | 12:54pm EDT
FILE PHOTO: U.S. President Trump makes announcement about China at the White House in Washington

By David Lawder

U.S. President Donald Trump has little choice but to stick with his Phase 1 China trade deal for now despite his anger at Beijing over the coronavirus pandemic, new Hong Kong security rules, and dwindling hopes China can meet U.S. goods purchase targets, people familiar with his administration's deliberations say.

The U.S.-China trade negotiations took more than two years, heaped tariffs on $370 billion of Chinese products, whipsawed financial markets and dimmed global growth prospects well before the coronavirus outbreak crushed them.

In recent weeks, suggestions that Trump may cancel the deal have emanated from the White House almost daily, and businesses, investors, and China trade watchers are hanging onto every word and tweet.

But on Friday, when Trump said the United States would start dismantling trade and travel privileges for Hong Kong, he did not mention the deal. Stock markets heaved a sigh of relief, with the S&P 500 reversing losses.

Talking tough on China and criticizing the Obama administration's more measured approach is a key part of Trump's re-election strategy. Sticking with the pact may mean accepting that China is likely to fall short of purchase commitments for U.S. agricultural goods, manufactured products, energy and services - goals that many said were unrealistic https://www.reuters.com/article/us-usa-trade-china/china-to-ramp-up-u-s-buys-under-trade-deal-but-skeptics-question-targets-idUSKBN1ZD0FN even before the pandemic.

In response to Trump's Hong Kong announcement, China told state-owned firms to suspend large-scale farm purchases including soybeans and pork, people familiar with the matter told Reuters.

Such a halt will put China further behind in making good on its pledges to boost U.S. purchases by $200 billion over two years.

But canceling the deal would reignite the nearly two-year U.S.-China trade war at a time U.S. unemployment is at its worst since the 1930s Great Depression.

The next U.S. step would likely be reviving previously planned but canceled tariffs on some $165 billion worth of Chinese consumer goods, including Apple Inc cellphones and computers, toys and clothing - all ultimately paid by U.S. companies and passed on to consumers. Beijing would retaliate with tariffs on U.S. goods, fueling more market turmoil and delaying recovery.

"He's stuck with a lemon. He gets an empty agreement if he sticks with it, and he gets more actions that create an economic drag and more volatility if he abandons it," said one person briefed on the administration's trade deliberations.

U.S. goods exports https://www.census.gov/foreign-trade/balance/c5700.html to China in the first quarter were down $4 billion from the trade war-damaged levels a year earlier, according to U.S. Census Bureau data.

The Peterson Institute of International Economics estimates https://www.piie.com/research/piie-charts/us-china-phase-one-tracker-chinas-purchases-us-goods that during the first quarter, China made only about 40% of the purchases it needed to stay on target for a first-year increase of $77 billion over 2017 levels, implying an extremely steep climb in the second half.

Leaving the deal now would not buy a lasting political bounce for Trump in manufacturing-heavy swing states with five months to go before the presidential election, analysts say.

COMPLEX RELATIONSHIP

Trump said on Friday that China was "absolutely smothering Hong Kong's freedom," but refrained from harsh sanctions that could put the trade deal in jeopardy, taking milder steps to revoke the territory's separate travel and customs benefits from China.

Claire Reade, a former U.S. trade negotiator, said Trump's "peripheral steps" would not deter Beijing from proceeding with the security law, as it regards Hong Kong as a core national security issue.

"Probably the most significant thing from the trade perspective is that the Phase 1 trade deal is - for now anyway - unaffected," said Reade, senior counsel with Arnold and Porter law firm in Washington.

U.S. Trade Representative Robert Lighthizer has recently cited https://ustr.gov/about-us/policy-offices/press-office/press-releases/2020/may/usda-and-ustr-announce-continued-progress-implementation-us-china-phase-one-agreement "continuing progress" in the deal, after China welcomed U.S. blueberries, barley, beef and dairy products.

U.S.-China flashpoints on Hong Kong, Taiwan and other issues did not derail negotiations that resulted in new concessions from China, said Jamieson Greer, who served as Lighthizer's chief of staff until April.

"Some of these security and human rights challenges have certainly complicated the atmosphere, but the trade agreement can still provide a set of rules governing important aspects of the trade relationship," said Greer, now an international trade partner at the King and Spalding law firm.

Another person familiar with USTR thinking said the agency "needs to make Phase 1 look good. They want to show that progress is being made. The president looks at the China relationship much more broadly."

(Additional reporting by Andrea Shalal; Editing by Heather Timmons, Chizu Nomiyama and Lisa Shumaker)

Stocks mentioned in the article
ChangeLast1st jan.
APPLE INC. 0.96% 384.7 Delayed Quote.30.06%
DJ INDUSTRIAL 1.68% 26469.28 Delayed Quote.-8.59%
NASDAQ 100 0.06% 10574.639745 Delayed Quote.21.40%
NASDAQ COMP. 0.16% 10378.323448 Delayed Quote.15.81%
S&P 500 0.78% 3171.74 Delayed Quote.-2.34%
SOYBEAN MEAL FUTURES (ZM) - CBE (ELECTRONIC)/C1 -2.65% 283.1 End-of-day quote.-5.60%
THE GLOBAL LTD. -0.47% 211 End-of-day quote.-55.20%
share with twitter share with LinkedIn share with facebook
Latest news on S&P 500
03:17pVirus worries and FOMO drive options bets on surging tech giants
RE
03:16pNEWS HIGHLIGHTS : Top Company News of the Day
DJ
03:16pNEWS HIGHLIGHTS : Top Global Markets News of the Day
DJ
03:15pGlobal stocks rebound on cyclical surge, gold edges higher
RE
03:13pGlobal stocks rebound on cyclical surge, gold edges higher
RE
02:15pWALL STREET STOCK EXCHANGE : U.S. Stocks Waver as Banks Kick Off Earnings Season
DJ
02:15pNEWS HIGHLIGHTS : Top Global Markets News of the Day
DJ
02:15pTHIS IS NOT A NORMAL RECESSION' : Banks Ready for Wave of Coronavirus Defaults
DJ
02:15pWALL STREET STOCK EXCHANGE : U.S. Stocks Rise as Banks Kick Off Earnings Season
DJ
01:33pCan Netflix stay one of Wall Street's favorite pandemic stocks? Results due T..
RE
More news
Chart S&P 500
Duration : Period :
S&P 500 Technical Analysis Chart | MarketScreener
Full-screen chart
Technical analysis trends S&P 500
Short TermMid-TermLong Term
TrendsBullishBullishNeutral
Top / Flop S&P 500
ALIGN TECHNOLOGY, INC. 297.17 Real-time Estimate Quote.9.97%
NOBLE ENERGY, INC. 9.46 Real-time Estimate Quote.9.11%
HANESBRANDS INC. 12.49 Real-time Estimate Quote.8.99%
XYLEM 72.565 Real-time Estimate Quote.7.76%
APACHE CORPORATION 13.325 Real-time Estimate Quote.6.43%
WELLS FARGO & COMPANY 24.165 Real-time Estimate Quote.-4.90%
INTUIT INC. 282.225 Real-time Estimate Quote.-5.18%
ROSS STORES, INC. 79.72 Real-time Estimate Quote.-6.01%
MOHAWK INDUSTRIES, INC. 71.67 Real-time Estimate Quote.-6.44%
TRANE TECHNOLOGIES PLC 29.5 Real-time Estimate Quote.-67.97%
Heatmap :