President Donald Trump held a long-anticipated phone call with Chinese President Xi Jinping on Thursday, marking the first direct contact between the two leaders in months amid heightened trade tensions and rising diplomatic mistrust. The White House has not publicly confirmed the conversation, but Beijing's Ministry of Foreign Affairs and China's embassy in Washington said Trump initiated the call.
The phone call came after weeks of silence and speculation, as trade relations between the world's two largest economies continued to deteriorate despite a brief reprieve last month. According to Chinese state media, the two leaders discussed bilateral trade, but no new agreements or breakthroughs were immediately reported.
Ahead of the conversation, Chinese officials had reportedly hesitated to confirm or schedule the call. According to people familiar with the situation, officials in Beijing were wary of Trump's unpredictability and referenced his past Oval Office ambushes of Ukrainian President Volodymyr Zelensky and South African President Cyril Ramaphosa as cautionary examples.
Stocks initially opened higher Thursday morning on news of the call, as investors hoped the direct engagement might ease tensions.
However, stocks later fell on Thursday after more reported developments between the U.S. and China on the trade front. The S&P 500 dropped 0.3%, while the Nasdaq Composite shed 0.2%. The Dow Jones Industrial Average also tumbled 168 points, or 0.4%.
The renewed outreach follows a period of escalating trade friction. While the two nations temporarily reduced tariffs following negotiations in Switzerland last month, that agreement appears to be faltering. The Trump administration has since accused China of failing to uphold its pledge to expedite the approval of critical mineral exports, a key issue in the Geneva talks.
This is a developing story. More to follow.
