Financial markets reacted to the tariff discussions between the U.S. and China that occurred over the weekend. Although no announcements were made regarding tariffs, the White House hinted at a potential agreement to address America’s global trade deficit, and China mentioned the establishment of a “mechanism” for future trade and economic discussions.
On Sunday, investors considered the initial U.S.-China trade talks, with both sides indicating progress without addressing tariffs directly. Futures for the Dow Jones Industrial Average increased by 444 points, or 1.1%. S&P 500 futures rose by 1.2%, and Nasdaq futures surged by 1.4%. The dollar saw a rally of 0.2% against the euro and 0.4% against the yen. The 10-year Treasury yield increased slightly to 4.382%.
Treasury Secretary Scott Bessent reported substantial progress in the trade talks between the United States and China, mentioning a more detailed briefing scheduled for Monday. U.S. Trade Representative Jamieson Greer, who participated in negotiations with a Chinese delegation led by Vice Premier He Lifeng, implied that some sort of agreement had been reached. Greer emphasized the goal of addressing the U.S.’s $1.2 trillion trade deficit, which led to the national emergency declaration and tariffs.
China’s Vice Premier He confirmed an agreement to create a “consultation mechanism” for future discussions on trade and economic matters, acknowledging progress in the talks as well. While a comprehensive trade deal was not anticipated, both countries’ positive comments suggested a de-escalation of tensions after significant tariffs were imposed by both sides.
President Donald Trump stated on Truth Social that an upcoming post would be among his most important and impactful yet, although this post had not been made by Sunday evening. According to Michael Brown, senior research strategist at Pepperstone, the result is seen as a “broad framework” for further discussions aimed at achieving a broader trade agreement. Brown noted that this outcome, while not a concrete deal, was not the worst-case scenario from the weekend’s talks.
This story was originally featured on Fortune.com.
