White House adviser: United States wants China trade deal as talks resume

Donald Trump criticises China for being 'spoiled' on trade, Wall Street turns negative

The China-U.S. conflict is about much more than trade

The administration is considering whether to ease up on one of China's largest telecommunications companies, ZTE, in exchange for China agreeing to buy more US products and lift its own restrictions on USA agriculture, people familiar with the deliberations said.

Branstad, who was present at the meeting, said the Chinese appeared to be "taken back" by the significance of the list.

ZTE may return to normal operations within the coming weeks following the seven-year export ban it received last month.

The US initially fined ZTE $1.19 million in March 2017 for violating sanctions against Iran and North Korea. "We'd like to see China being just as open as the United States", Branstad said. Commerce Secretary Wilbur Ross said much the same on Monday. "President Trump expects [Commerce Secretary Wilbur] Ross to exercise his independent judgment, consistent with applicable laws and regulations, to resolve the regulatory action involving ZTE quickly based on its facts".

But in a surprise tweet Sunday, the president held out the possibility of a reversal for the company.

At the White House, spokesman Raj Shah said Mr. Trump's request for Ross to reexamine the issue was part of a "give and take" with the Chinese. The Trump administration said ZTE had broken its agreement to punish employees who violated U.S. sanctions against North Korea and Iran.

"At the moment, the market is breathing a sigh of relief that some of the fears over tariffs and inflation, in particular, have not been realized", said Mike Baele, managing director at U.S. Bank Private Client Wealth Management in Portland, Oregon. Given past vows to stop the flow of U.S.jobs to China and what he has called unfair trade practices, Mr. Trump's seeming concern about Chinese jobs was something of a backflip.

An agreement could not be reached on the demands by the United States, and talks are to resume in Washington.

But both Republican and Democratic lawmakers have expressed concerns that Chinese telecom companies such as ZTE have ties to the Chinese government and pose a cyberespionage threat as they move into the US market.

"Any telecom firm in #China can be forced to act as a tool of Chinese espionage without a court order or other review process", Rubio said. "We want to see these things happen sooner than later", he said at a conference in Tokyo. "But before it's even implemented, the president backs off".

And so investors breathed a sigh of relief after Trump's tweet, buying stock Monday in Maynard, Massachusetts-based optical components maker Acacia Communications, which a year ago collected 30 percent of its revenue from ZTE; San Jose-based optical communications company Oclaro; and Sunnyvale, California-based fiber optic cable manufacturer Finisar. "The Pentagon even stopped selling its phones in its bases. What happened to America First?"

Global shares were mixed in muted trading Tuesday amid continuing uncertainty over trade tensions between China and the U.S. Investors were watching for U.S. retail sales data due out later in the day.

President Donald Trump has insisted that the countries reduce the $370 billion trade deficit with China by $200 billion.

"Too many jobs in China lost", Trump tweeted. "Commerce Department has been instructed to get it done!"

"The United States and China are the two biggest economies in the world".

Gaming company stocks jumped as the U.S. Supreme Court paved the way for states to legalize sports betting. They have been making hundreds of billions of dollars a year from the US, for many years. This had a significant impact on the company, said to be the fourth largest smartphone vendor in the US before the ban, as it relies heavily on supplies from USA corporations such as Qualcomm and Intel.

China on Monday welcomed President Trump's comments.

Foreign Ministry. "We are now in close communication over details of the implementation".

Information for this article was contributed by Ana Swanson and Keith Bradsher of The New York Times and by staff members of The Associated Press.

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