A recent report revealed that China's President Xi Jinping and United States President Donald Trump are set on finalizing 'phase one' of the China-US trade war. As a result, stocks have reached a new high in China and the investors expect CAPEX spending.
According to a report from CNBC, the completion of "phase one" of the China-US trade war would commence this coming December 15, 2019, after a series of negotiations. The finalization would round off tariff rates of Chinese goods which got the investors excited, an expert claimed.
Director of NYSE floor operations Art Cashin said, that the industry is keeping eyes on every stage of negotiations and that the developments have urged the investors to increase their inputs for every good news.
Chief Market Strategist at the US National Securities Art Hogan also added that once the location of the deal signing would be set, the date announcement would then follow and result in better financial activity in the global market.
Hogan claimed that investors are looking forward to the halt of the China-US trade war and expect some rollback of other tariff rates. Due to this possibility, the expert revealed that investors have regained their confidence in the global economy that they show signs of CAPEX spending. This financial activity has been absent in the market in the last 18 months, he added.
Last Wednesday, Evercore analysts also shared that the completion of "phase one" has three separate possibilities. They said that a delay in the setting of tariffs may happen or that China would open up its financial markets to agricultural products further.
Policy strategists also believed that agricultural sales between China and the US may improve. The latter may lift the blacklisting of Huawei into its market.
According to the head of policy research at Stategas Dan Clifton, US exports on liquified natural gas were also discussed during the negotiations and maybe a part of the "phase one" deal.
Washington strategist at Fundstrat Tom Block also said that President Trump may make a formal announcement once the deal is done. He said that the closing is inevitable since both sides are near resolution and that selling their domestic products would seal the deal.
According to NBC News, the suspension of the tariff rates signaled good news for American investors and Beijing. According to a professor of economics and international affairs at George Washington University Michael O. Moore, the re-election of Trump may pose an opportunity for China to accomplish its purpose for the "phase one" deal. The report indicated that the investors eyed opportunities on consumer goods such as electronics, shoes, and toys as well as American agricultural products.
