US President Trump concludes "Phase One" trade deal with China

Donald Trump wearing a suit and tie

In our news wrap Friday, the USA and China reached a partial trade deal after 15 months of disagreement.

Media reports this week have drawn the contours of a partial deal that, while not addressing Trump's core grievances about China's trade practices, would offer something for both sides.

The trade war has taken an economic toll on both countries.

Mr. Trump said the deal would result in an additional $40 billion to $50 billion in farm purchases by China.

The current agreement - not yet finalized on paper - covers intellectual property, financial services and China's commitment to purchase up to $50 billion worth of US farm products.

Washington still is planning a December 15 tariff hike on $160 billion of smartphones and other imports.

Wall Street was poised to rally at the open as investors bet a partial pact would see President Donald Trump postpone next week's scheduled tariff increases on hundreds of billions of dollars in Chinese imports.

Negotiations on phase two will begin immediately after concluding phase one, Trump said.

President Donald Trump announced the trade truce in a White House meeting with the top Chinese negotiator, Vice Premier Liu He.

Hirson said the two sides ultimately may not get through to phase two. Trump is planning to meet Chinese President Xi Jinping in Chile next month.

Trump and Chinese President Xi Jinping are both scheduled to attend a November 16 summit of the Asia Pacific Economic Cooperation countries in Santiago, Chile, and Trump hinted that a written agreement could be signed there. "But there is a significant amount of work to do".

"They're trying to de-escalate", said Timothy Keeler, a lawyer at the law firm Mayer Brown and former chief of staff at the Office of the U.S. Trade Representatives.

In 2017, before the trade war started, China imported US$19.5 billion of USA farm output, falling to just over US$9 billion in 2018.

US stocks and bonds reportedly jumped ahead of hopes for a new deal.

In commodity markets, crude oil prices gained after an Iranian tanker near the Saudi Arabian coast suffered damage Friday in what the ship's owner suggested may have been a missile attack.

Business groups expressed relief that the negotiations appeared to be making progress after more than a year of sputtering, yet they acknowledged that the agreement fell short of the sweeping deal that Trump had promised.

"The president is acting as if a lot of Chinese concessions have been nailed down, and they just haven't", Scissors said.

The bruising battle over China's trade surplus and technology ambitions has disrupted global trade.

The S&P 500 and Dow Jones indexes looked set to break a three-week losing streak on optimism that the world's top two economies could cool off their row before more US tariffs kick in next week.

China's government welcomed "substantial progress" but gave no details of possible agreements.

"For businesses this will mean less damage, not greater certainty", Daco said in a research note.

Trump imposed curbs in May on sales of American components and technology to Huawei Technologies Ltd., China's first global tech brand.

"We will not sign an agreement unless we get, and can tell the president, that this is on paper".

Mnuchin said that the United States would decide whether to rescind the designation in a future phase of negotiations.

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