Technology companies, banks and industrial companies all rose Thursday as investors got ready for big banks to announce their first-quarter results and let go of some of their concerns about the trade dispute between the US and China. "Today's message from Xi contained nothing really new but it seemed like a conciliatory tone and so the market is just grabbing at that", said Peter Garnry, head of equity strategy at Saxo Bank in Copenhagen.
Xi's renewed pledges to open up the auto sector come after Trump on Monday criticized China on Twitter for maintaining 25 percent auto import tariffs compared to the United States' 2.5 percent duties, calling such a relationship with China not free trade but "stupid trade".
So far, USA has ordered import tariffs on $50 billion in Chinese goods, to which China responded by ordering tariffs on $3 billion of United States imports. He didn't address other thorny topics including requirements for foreign companies to give technology to potential local competitors. Earlier this week Larry Kudlow, Trump's top economic advisor, said limited interactions already had taken place but no serious discussions to avoid tariffs. U.S. officials have long accused China of forcing United States companies to hand over technology, or stealing it outright, and of spurring massive industrial overcapacity, among other complaints. Towards the end of March he announced tariffs on up to $60bn of annual Chinese imports and stated that Beijing needs to pay the price for decades of unfairly acquiring USA intellectual property.
Then, Trump ordered the US trade representative to consider another $100 billion in Chinese imports to tax. But following Trump's tweet the White House made clear it wants to see changes enacted in China. But the current dynamics between the two countries make it hard to sit down and negotiate.
Trump's absence from the Summit of the Americas will mark the first time a US president has not been a part of the event since it began in 1994.
Russian financial markets sold-off sharply. Xi reinforced that previous year when he spoke at Davos for the first time in a rousing defense of free trade and climate change. China has responded with its own list of USA goods it could levy, including soya beans, aircraft and other major U.S. exports, many of which come from battleground states influential in upcoming midterm elections.
Sourabh Gupta, senior fellow at the Institute for China-America Studies in Washington, D.C., made the remarks in a written interview with Xinhua on his take-aways from Chinese President Xi Jinping's keynote speech at the Boao Forum for Asia (BFA) annual conference on Tuesday.
Futures in NY erased earlier losses in the day to rise as much as 1.5% as Xi vowed to open sectors from banking to auto manufacturing, increase imports and lower foreign-ownership limits.
He promised to encourage "normal technological exchange" and "protect the lawful ownership rights of foreign enterprises". That would cause China more economic pain.
Speaking on the eve of the Summit of the Americas that will bring leaders from across the western hemisphere to Peru this week, the ambassador Jia Guide downplayed reports that the US planned to use the event to urge Latin American leaders to work with Washington and not Beijing on trade. Instead, the report found, Chinese regulators "continue to require or pressure foreign companies to transfer technology as a condition for securing investment or other approvals".
Trump on Monday criticized China for maintaining 25 percent import tariffs on autos compared to the 2.5 percent duties of the US, calling the relationship "stupid trade".
The State Council Information Office, which represents China's central government, didn't reply to faxed questions Monday on US trade talks. Pat Roberts, R-Kan., chairman of the Senate Agriculture Committee, said at a meeting of agricultural reporters in Washington.
The comments prompted a rapid and largely positive reaction in financial markets, which have been rattled over the past week on fears the tit-for-tat U.S.