US markets lose early gains on phase one trade war deal signing as traders worry about wider issues
- Dow industrials jump as much as 206 points ahead of signing, then regroup as assessments are made
- Beyond tariffs, analysts note, numerous other issues continue to plague the US-China relationship
US stock markets lost earlier gains to close relatively flat on Wednesday, after initial enthusiasm about the signing of a phase one trade war deal between Washington and Beijing failed to reassure traders about lingering broader issues.
After an initial leap in stocks, US exchanges stepped back. The Dow Jones Industrial Average closed slightly up by 91 points after rising as much as 206 points in the early trading session in New York, ahead of the midday deal signing.
The incremental trade deal inked by US President Donald Trump and Chinese Vice-Premier Liu He in Washington marked the long-expected truce of a drawn-out trade war between the two countries that has gone on for 18 months. Included in the deal is a commitment from Beijing to buy roughly US$200 billion of American goods and services over two years.
The index has risen 14 per cent since the end of August, when the two countries announced trade negotiations had resumed after a summer hiatus.
“Wall Street loves this deal as it is,” Trump said at the signing.
Wednesday’s signing in the East Room of the White House, however, isn’t an antidote of a host of broader issues that could rock the markets going forward.