Markets are responding positively, on Monday, to news that the U.S. and China have re-engaged in trade negotiations, after President Trump and China Party Secretary Xi Jinping held a closed-door meeting in Osaka, Japan, this past weekend, 

The Dow Jones Industrial Average rose 254 points at the day’s opening, while the S&P reached an all-time high of 2,976 during intra-day trading. In particular, American technology companies that sell computer equipment into China, including Apple and Qualcomm, have seen pronounced gains.

Both the U.S. and China are keeping current tariffs in place on each other’s exports, while a formal trade agreement between them is hammered out. However, tensions seem to have eased over what was feared to become a prolonged trade war, with both sides returning to the negotiating table.

Markets had shown early signs of uneasiness in May, after U.S.-China trade discussions broke down. The ongoing dispute and subsequent tariffs had begun to cause repercussions upon global supply chains and slowed economic growth beyond the two powers’ own economies.

President Trump has shown he is prepared to lake at least one concession to China, which is to allow U.S. technology companies to sell technology to China telecom giant Huawei.

Use of the company’s networking technology is still banned in the U.S., after the U.S. Justice Department issued multiple indictments against Huawei related to theft of intellectual property, obstruction of justice, and fraud. Huawei’s wireless technology company also carries functionality that could enable large-scale spying by Chinese intelligence. However, Trump appears willing to allow American companies to share its own technology with the telecom, while not utilizing Huawei components in American products. 

President Trump has also withdrawn his recent threat to more than double the amount of Chinese imports that could be subjected to new tariffs. Prior to the G20 Summit, Trump indicated was prepared to apply a second round of tariffs to an additional $300 billion in Chinese imports, should a new trade deal fail to move forward.

Speaking with reporters in Seoul, South Korea, on Sunday, Trump maintained that he is not in a hurry to complete a new trade deal with China, largely due to the strength of the current U.S. economy.

“We’re winning, and we’re winning big, because we have created an economy that is second to none, greatest in the world,” Trump explained. “China wants to make a deal. I want to make a deal, a very big deal probably. I guess you’d say the largest deal ever made of any kind, not only trade.”

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