Global markets underwhelmed by US-China trade truce
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Global markets remained flat today as initial optimism about a US-China trade deal faded amid concerns about how quickly an agreement could be sealed.
Read more: European stock markets fall on China data and Brexit
US President Donald Trump last week said he had secured a limited trade deal with China, which will see the US hold off on further tariff increases and China increase agricultural purchases.
However, Trump has since acknowledged that the agreement could still fall through, while treasury secretary Steven Mnuchin warned additional tariffs would be imposed if a deal was not in place by 15 December.
Investor confidence was further dashed following media reports that China wanted more talks as soon as the end of the month to thrash out the details of the initial truce.
The Dow Jones Industrial Average opened up 0.2 per cent, while the S&P 500 and Nasdaq were down 0.08 and 0.10 per cent respectively. The FTSE 100 closed down 0.46 per cent.
“On a second glance and in the cold light of day, investors are not viewing the much-hyped breakthrough in US-China trade talks in quite the same way as before the weekend,” said Fiona Cincotta at Cityindex.
“After a more thorough analysis investors are viewing it a mere promise for a month’s truce; a promise which could easily be reversed.”
Investors will now be looking to third-quarter trading updates, which kick off tomorrow, to gauge the impact of the trade talks.
Read more: Investors hope for end to market jitters after US-China trade truce
A raft of the US’s largest banks are expected to post a decline in earnings due to lower interest rates, several unsuccessful stock market floats and trade tensions.
Main image credit: Getty