One of the key events of last Sunday, December 2, was the trade truce between the two largest economies, the United States and China. The leaders of the states agreed to temporarily hold off on new tariffs and resume negotiations, thus easing tensions in world trade. The current situation had a positive effect on Wall Street, becoming a catalyst for a rally in the global financial market.
PRC President Xi Jinping and US President Donald Trump set an ambitious deadline of 90 days to reach a broader trade agreement, which will allow stock markets to recover and help a volatile trading year to end positively, investors believe. During these 90 days, the parties will try to resolve a number of disagreements relating primarily to the transfer of technology, intellectual property, and cybercrime.
For a long time, the tension in the trade relations between Washington and Beijing exerted significant pressure on stocks. The securities market was in the correction phase after the October sales, and in November 2018, it showed a volatile trend. This resulted in a 10% fall of the S&P 500 index from historic highs.
According to experts, after last week’s positive statements of Jerome Powell, chairman of the US Federal Reserve, Wall Street has recovered and continues to show a positive trend. The attention of leading market players is currently focused not only on trade but also on the Fed policy. This week, Powell is scheduled to testify before the US Joint Economic Committee. Experts expect positive news from the head of the regulator.
