President Trump tweeted this morning that Beijing wants a “calm resolution” to the ongoing trade war that has roiled markets for over a year. Between meetings at the G7 summit in Biarritz, Trump shored up the tweet by saying, “They want calm, and that’s a great thing, frankly. And one of the reasons that he’s a great leader, President Xi, and one of the reasons that China’s a great country is they understand how life works.”
The assurance was enough to push equities higher, with the three major indexes moving up roughly half a percent on the news. The Dow was up 120 points.
On the other side of the world, the news was met with skepticism. Hu Xijin, editor of the Global Times, tweeted a contradictory message, stating that the talks have remained on a “technical level” and that “China won’t cave to US pressure.” Funny how a journalist can become the mouthpiece of the second largest economy worldwide, but that has been China’s preferred method of communication.
Interestingly, Xijin sounded less assured than usual, his typically fiery rhetoric decidedly diluted with the caveat of “Based on what I know” and the admittance that “The two sides have been keeping contact”.
At any rate, the markets have decided that any news is better than none, and regardless of who said what, the fact that there is talk of further talks is preferable to silence.
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