Markets slide as China-US deal expected to prove elusive

Markets slide as China-US deal expected to prove elusive

04/05/18

Luke Foddy, Communications Manager

European markets dipped on Thursday as analysts predicted slow progress in China-US trade talks.

The UK’s FTSE 100, Germany’s DAX and France’s CAC all closed the day at a low, The Guardian reports, reflecting a cautious mood among investors.

The negotiations, which The Wall Street Journal described as likely to be ‘recurring, difficult talks that don’t produce an immediate settlement,’ are viewed as crucial to averting a fully-blown trade war which would quickly envelop the global economy.

Neither side has yet issued a notable comment following the first day of talks, which are set to conclude on Friday, but many analysts are predicting an early impasse. Likening the negotiations to ‘an unstoppable force meeting an immovable object,’ Sky News predicts a stalemate.

Earlier on Thursday, President Trump attempted to set a positive tone, tweeting: “Our great financial team is in China trying to negotiate a level playing field on trade! I look forward to being with President Xi in the not too distant future. We will always have a good (great) relationship!”

But any deal to ‘fundamentally change China’s economic policies is viewed as highly unlikely during the two days of talks,’ Reuters reports, adding that ‘a package of short-term Chinese measures could delay Washington’s decision to impose tariffs on about $50 billion worth of Chinese exports.’

The talks are expected to end on Friday evening, when the US team departs.