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Stock Market On a Huge Comeback Despite Trump's Trade Threat

May 7, 2019 | Tuesday

Stocks

   

Despite United States President Donald Trump's threat to give more tariffs on China, the analysts say that it was more of a bargaining tactic. That while the outcome expected is an all-out-trade dispute.

Even with a sheer drop on stock on the start of the week, the losses eliminated during the late trading session. A big comeback began upon a report regarding Chinese delegation are to come to the United States as its initial plan.

President Trump on his tweets last Sunday threatens to increase tariffs on Chinese goods amounting to $200 billion and to put tariffs on other goods worth $325 billion.

The Chinese negotiators keep its plan to attend the talks in Washington this week. The Chinese Vice Premier Liu will also attend. Vice premiere attending the talk wasn't clear until Monday's market close. Meanwhile, a number of analysts see a positive sign for the talks this week.

The stocks began to sell off hard upon the tariff threats. The Dow was down more than 470 points during Monday session opening. But the losses were gone throughout Monday's session. It ends the last session off by 67, to a 26,437. Meanwhile, the S&P 500 also down ending the session down by 13 to a 2,932.

According to Bespoke Stock Scores, both Dow and S&P 500 were down by more than 1 percent before they recover. That was their biggest opening gap lower since January 2.

There are a number of economists believing that a deal is to reach in the future. However, Bank of America economist in Hong Kong said there might be an obstacle as there's not a same urgency reaching an agreement as both countries see better economic growth and better market performance.

Rhetorically speaking, it could grow, even if the tariffs don't increase at the end of the week. Trump said on his tweet that he might raise about 10 percent tariff on $200 billion worth of goods. President Trump also threatens to add 25 percent tariffs on other $325 billion worth of goods.

   

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