Uncertainty On Wall Street - Most In At Least 20 Years

China & America Set Up A Meeting

Big news on trade that sent stocks higher on Thursday was that Chinese top trade negotiator and U.S. trade representative Robert Lighthizer had a phone call in which the two agreed to another round of trade negotiations in early October. Consultations will be made in mid-September for the meetings. This situation has been repetitive. After every new round of tariffs is announced there are new negotiations.

It’s surprising to see stocks rally this much on the news considering how close they are to a new record high and how far away the two sides are from a trade deal. Even though I’m predicting a deal within the next few months, the fact that there are talks should be a given. The two economies are about to be hurt by this next round of tariffs. 

Neither side wants a trade war to severely impact their economies in 2020. If there is news that the talks are going well in October, stocks will hit a new record high. This news tells us another thing we already pretty much knew. There won’t be a trade deal in September. This latest round of tariffs will be in effect for at least a few weeks. A tax rate increase from 25% to 30% on $250 billion in Chinese goods that starts in October will also happen. 

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