(Wednesday Market Open) Optimism about a trade deal between the U.S. and China has ebbed and flowed in recent months. Today, it seems to be swelling, and in this case a rising tide lifts all freighters.
With talks between the world’s two largest economies continuing in Washington this week, hopes seemed high after a Financial Times report quoted Myron Brilliant, executive vice president for international affairs at the U.S. Chamber of Commerce, that a deal is 90% done. Also, White House economic adviser Larry Kudlow said on Tuesday that the two sides “expect to make more headway,” Reuters reported.
But before anyone gets too excited, Brilliant also said the last 10% is the hardest part. So, while things seem to have taken a nice step in the right direction, the devil is in the details, which Wall Street hasn’t seen yet.
An index that showed gains in China’s private sector also appears to be helping sentiment this morning, coming on the heels of solid manufacturing data from the Asian nation as well as the United States, which helped boost stocks on Monday.
Taking A Breather
If Monday’s strong U.S. stock performance was like a blowout basketball win, yesterday’s performance was like going for a layup or maybe just running out the clock.
The (SPX) was essentially unchanged near its highest levels since October while the (COMP) was up a touch and the ($DJI) fell a smidge. It seemed market participants wanted to take a breather following one of the best Wall Street performances of the year, with all the major indices up 1% or more and the SPX nearing a six-month high Monday.
The small nature of the moves in the major U.S. indices Tuesday seemed to indicate that there wasn’t too much profit-taking going on. There also wasn’t much