Business

Markets recover some losses after trade-related rout

by Niv Elis - 05/14/19 12:57 PM ET

U.S. stock markets on Tuesday recovered about half of the value they lost the day before due to increasing trade tensions.

The Dow Jones Industrial Average spiked 300 points in midday trading, covering roughly half of the 617 points it lost Monday, while the S&P 500 was up as much as 36 points after losing 70 on Monday.

Monday’s stock losses followed China’s announcement that it planned to raise tariffs on $60 billion worth of U.S. exports, a response to President Trump’s decision last week to increase tariffs on $200 billion of Chinese imports.

{mosads}On Monday evening, the Trump administration unveiled a list of items for potential new tariffs, which would cover some $300 billion of U.S. imports from China.

The latest escalations in the trade war resulted from a snag in negotiations over a trade deal. Trump said that China backed off previous commitments in the negotiations. He also announced that he would meet with Chinese President Xi Jinping at the upcoming Group of 20 summit in June.

The Tuesday rebound could indicate that traders believe a deal is still likely in the coming weeks, a possibility Trump seemed to keep open.

“When the time is right we will make a deal with China,” Trump tweeted Tuesday morning. “My respect and friendship with President Xi is unlimited but, as I have told him many times before, this must be a great deal for the United States or it just doesn’t make any sense.”

Tags Donald Trump Stock market trade war