Trump Flags End To China Trade War As Stocks Dive
US President Donald Trump has signalled an end to an ongoing trade feud with China as US stocks plunge over mounting concerns over the fallout.
On Friday, Trump expressed confidence he can reach an end to the ongoing trade war with China, he says the protracted trade negotiations will soon come to a head when the two powers meet.
"I think we'll make a deal with China, and I think it will be a very fair deal for everybody," Trump said ahead of the meeting with China in Argentina in a month’s time.
Trump said he will have dinner with Chinese President Xi Jinping at the November 30-December 1 G20 summit of industrial and emerging market nations.
The Trump-Xi meeting would mark the first since the countries trade relations started to strain with the introduction of import taxes earlier this year.
The United States has targeted $348 billion in Chinese products with tariffs, a move which saw Beijing lashed back with $153 million tariffs U.S. goods.
Trump has since threatened to impose further $371 billion tariffs on Chinese imports -- a move that would cover virtually everything China ships to the United States.
The news comes as the volatile trade relations weigh in on the US stock market, with stocks taking a turn after a rally in world equity markets came to a close and gains reversed on Wall Street.
On Friday, markets climbed following hopes Chinese-US relations were on the mend but gains were soon reined in as uncertainty over the trade deal hits investor confidence.
White House economic adviser Larry Kudlow told CNBC that while US President Donald Trump plans to meet Chinese President Xi Jinping later this month, he has not asked US officials to draw up a proposed trade plan, contradicting a report earlier in the day that had buoyed hopes of a resolution.
The news erased early gains in US stocks and a rally in global markets that had lifted emerging market stocks by their largest daily gain since 2016.
"The stock market is focused on tariffs and they believe that increased tariffs are going to hurt the economy," said Mike Rask, director of trading at Hodges Capital in Dallas.
"There was the belief overnight that we were close to a trade deal with China and now it looks like that is not the case."
Earlier Friday, the Chinese foreign ministry said Trump and Xi had an "extremely positive" phone conversation on Thursday.
The two leaders agreed to "strengthen economic exchanges," said a ministry spokesman, Lu Kang, who gave no indication of an end to the strained negotiations.trade
Trump told reporters in Washington that "I know they want to make a deal".
He added that any deal reached must be "fair."
But Larry Kudlow, Trump's top economic adviser, sounded a more cautious note on CNBC Friday.
"We are not on the cusp of a deal," Kudlow said.
"As the president said, we would like to talk to them about it, but they may not be ready."